There may be periods when the property market experiences a
protracted slump.
In these circumstances a one off transaction may give rise to
a loss. You may be faced with an argument, from a person who is
not a land dealer, that the transaction was a
trading transaction and the loss is relievable as a trading loss.
It is however important to apply the same principles in
determining the character of loss making transactions as profitable
ones. Once again the final question is whether the transaction
could fairly be described as a 'deal or an investment' (Marson v
Morton and Others[1986] 59TC381) albeit, in the latter case, an
investment which went wrong. The key issue is the intention of the
purchaser at the time of acquisition (Lionel Simmons Properties Ltd
v CIR [1980] 53TC461).
