Taxpayer has £12k of losses carried forward from one and a half properties. He moved back into his solely owned flat for an entire tax year, whilst renovating his main residence, then let it again. He continued letting another property with his spouse (which made a small loss for 16/17). Can all the losses be carried continue forward against future profits?
The HMRC manual says:
ITA09/S117 and S118 refer to a deduction from the profits of ‘the business’ for subsequent tax years. Therefore losses arising in one property business cannot be carried forward against profits of another rental business which the customer has in a different capacity. For example, if a customer has let property of his own and is a member of a partnership which has rental income, losses of his personal rental business cannot be set against his share of the partnership’s rental income.
Is this a 'different capacity'?