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HMRC internal manual

General Insurance Manual

HM Revenue & Customs
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Taxation of the investment return: use of trading losses against investment income

Investment income is an integral part of the trading profit (GIM5010). ICTA88/S393 (8) applies to this type of investment income, namely income which would fall to be treated as part of the trade profits but for the exclusivity of the Schedules (see GIM5030).

Such investment income is treated as trading income against which trading losses incurred in an earlier period may be offset under ICTA88/S393.

As ICTA88/S393 (8) applies only to income which has been charged to tax otherwise than as trade profits, its only practical application is likely to be to Schedule A income and to foreign dividends due before 1 April 2001.