UK Property Business Losses in a company

Property losses offset against capital gain

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A limited company's only activity is a UK property business. There are no capital allowances available. Taxable profits/losses are as follows:

Unrelieved property loss brought forward from previous period £10,000

Property loss - current period £30,000

Chargeable gain - current period £60,000

My question is can either  the property loss brought forward, or the current year property loss, or both, be offset against the chargeble gain? Or is the only option in this situation to carry forward the cumulative losses for offset against future property income. My software seems to think that both the losses can be offset against the gain, however I remain wary. Guidance/reassurance most welcome.  

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By Guy From
13th Jul 2016 20:25

A few threads here already in the same vane, but yes you are right to be suspicious.
As you suspected, the 10,000 is a loss and so can only be offset against future profit/income. The Gain can unfortunately only be offset against other capital loss/depreciation- the 2 are not interchangeable

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By User deleted
13th Jul 2016 21:53
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By stanbu
13th Jul 2016 23:24

Following taxguru's reference you will see that property income losses are carried forward snd treated as a loss made in the next period. Therefore the £10,000 is added to the current period £30,000 and treated as having been made in the current year, i.e. now a £40,000 property loss in the current year.
Your software is therefore currect to offset those losses against other profits made in the current year, the chargeable gains.

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