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HMRC internal manual

Property Income Manual

Use of trading income rules: rules which do not apply

While most of the Case I rules in ICTA88/S74 - S99 apply to Schedule A, there are four which are specifically excluded by ICTA88/S21A (4). These are:

  • relief for interest paid to non-residents (ICTA88/S82),
  • lease premium relief for traders (ICTA88/S87),
  • averaging for farmers (ICTA88/S96),
  • tied premises (ICTA88/S98).

For the purposes of ITTOIA05 the equivalent sections are simply omitted from the list in ITTOIA05/S272 (2) - see PIM1103.

Relief for interest paid to non-residents

For more guidance on interest payable in IT cases see PIM2100 onwards.

Farmers’ averaging

If a farmer or market gardener has rental income, any averaging claim must be applied to the trade income only and not to the rental income.