HMRC internal manual

Partnership Manual

PM193000 - Calculation of limit relief: £25,000 annual limit

S103C Income Tax Act 2007

For losses sustained on or after 2 March 2007 there is an annual limit of £25,000 on the amount of losses for which sideways loss relief can be claimed by affected partners. The annual limit is applied after other restrictions (see PM192000) have been calculated.

The annual limit does not apply to trading losses derived from carrying on a Lloyds underwriting business. It also does not apply to losses derived from qualifying film expenditure (see PM192000).


Partners affected

The £25,000 annual limit applies to losses made by:

  • limited partners,
  • non-active general partners,
  • non-active LLP members.


No restriction of reliefs against income of the same trade

The legislation restricts relief against income from other sources. It does not restrict relief against income derived from the same trade, whether of earlier or later years. Where relief from a trading loss is given against general income of another tax year, which includes both trading income and non-trading income, relief is deemed to be given first against trading income from the same trade.