Section 122 — Income Tax Act 2007: Meaning of “the applicable amount of the loss”

Meaning of “the applicable amount of the loss” 122 1 This section defines “ the applicable amount of the loss ” for the purposes of sections 120 and 121. 2 “The applicable amount of the loss” is—

a the amount of the loss, or b if less, the amount arising from the relevant connection (see subsections (3) to (5)).

3 If—

a the loss has a capital allowances connection, but b the business does not have a relevant agricultural connection, the amount arising from the relevant connection is the amount (“the net capital allowances”) by which the capital allowances exceed the charges under CAA 2001.

4 If—

a the business has a relevant agricultural connection, but b the loss does not have a capital allowances connection, the amount arising from the relevant connection is the amount of the allowable agricultural expenses.

5 If—

a the loss has a capital allowances connection, and b the business has a relevant agricultural connection, the amount arising from the relevant connection is the sum of the net capital allowances and the amount of the allowable agricultural expenses.