Income tax rules

Normal rules

Property business losses cannot usually be offset against the individual's other income and gains for the year. ITA 2007, ss 118-120

Instead the loss is carried forward and set against future profits of the same property business.

An individual's UK property business and overseas property business are treated as separate businesses. This means that UK property business losses can be set against UK property business profits only and overseas property business losses can be set against overseas property business profits only.

If the following year's profits are too small to absorb the loss brought forward (or if there is a loss in the following year) the unused loss is carried forward indefinitely so long as the same business continues (see below for a discussion on the cessation of a property business).

Access this article and thousands of others like it free
for 7 days with a trial of TolleyGuidance.


Already a subscriber? Login

Request a Free Trial to TolleyGuidance to gain access to the full article

TolleyGuidance is produced by specialists within the field, our tax guidance materials provide actionable insights and practical guidance to support you day-to-day. We don’t just inform you about the latest changes in the tax world. We take the time to explain the implications and, most importantly, what actions you need to take for your clients.

A bit about you:

Please note that all fields marked with a * must be filled in
First name*
Last name*
Job title*