Use of b/f Land & Property losses

Use of b/f Land & Property losses

Didn't find your answer?

To keep things clear and simple, assume that sole income is from L&P (straightforward residential lettings) which generates a profit less than the personal allowance in the year being considered but with there being significant b/f losses available.

My impression is that those b/f losses MUST be reduced by the full profit of the year and the net losses carried forward. It seems there is no option to preserve all the b/f losses and treat all the year's profit as taxable income (which would be covered by the PA). Similarly, one couldn't (in different circumstances) utilise b/f losses only to the extent that they'd reduce the profit of the year to the level of the PA.

Is my understanding fully correct or is that merely how the construction and presentation of the SA return encourages one to interpret the situation?

Replies (1)

Please login or register to join the discussion.

Teignmouth
By Paul Scholes
04th Jan 2012 22:49

Spot on

Property losses b/fwd are automatically set against any available property profits, before any PA or other reliefs.  per CCH = ITA 2007 S118 & 119.

Thanks (1)