Section 64 — Income Tax Act 2007: Deduction of losses from general income

Deduction of losses from general income 64 1 A person may make a claim for trade loss relief against general income if the person—

a carries on a trade in a tax year, and b makes a loss in the trade in the tax year (“the loss-making year”).

2 The claim is for the loss to be deducted in calculating the person's net income—

a for the loss-making year, b for the previous tax year, or c for both tax years. (See Step 2 of the calculation in section 23.) 3 If the claim is made in relation to both tax years, the claim must specify the tax year for which a deduction is to be made first.

4 Otherwise the claim must specify either the loss-making year or the previous tax year.

5 The claim must be made on or before the first anniversary of the normal self-assessment filing date for the loss-making year.

6 Nothing in this section prevents a person who makes a claim specifying a particular tax year in respect of a loss from making a further claim specifying the other tax year in respect of the unused part of the loss.

7 This section applies to professions and vocations as it applies to trades.

8 This section needs to be read with—

a section 65 (how relief works),

b sections 66 to 70 (restrictions on the relief),

ba sections 74ZA to 74D (general restrictions on relief),

bb . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . c sections 75 to 79 (restrictions on the relief and early trade losses relief in relation to capital allowances),

and d section 80 (restrictions on those reliefs in relation to ring fence income),

e . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . f . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .