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HMRC internal manual

Capital Gains Manual

HM Revenue & Customs
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Gains from which pre-entry losses are deductible: change in trade

A major change in the nature or conduct of a trade includes

  • a major change in the type of property dealt in, or the services or facilities provided, or
  • a major change in customers, markets or outlets.

A major change may result from a gradual process beginning outside the three year period.

Note: Additional rules relating to loss buying were enacted in FA 2006. See CG47020+ for guidance on the rules which apply in priority to TCGA92/SCH7A for accounting periods ending on or after 5 December 2005.

FA11/S46 and FA11/SCH11 greatly simplified the rules in TCGA92/SCH7A for the deduction of losses on or after 19 July 2011. See CG47400+ for guidance on loss streaming from that date.