BIM72611 - Partnerships: loss relief restrictions: calculation of limit of relief: £25,000 annual limit from 2 March 2007
For losses sustained on or after 2 March 2007 there is an annual
limit of £25,000 on the amount of losses for which sideways
loss relief can be claimed by affected partners. The annual limit
is applied after other restrictions (see
BIM72610) have been calculated.
The annual limit does not apply to trading losses
derived:
- from relevant film-related losses, see BIM72614; or
- from carrying on a Lloyds underwriting business.
Partners affected
The £25,000 annual limit applies to losses made by:
- limited partners
- non-active general partners (for all years of trading, not just early years)
- non-active LLP members (for all years of trading, not just early years).
Basis periods straddling 2 March 2007
Where the partner’s basis period to which the losses
relate straddles 2 March 2007 (which may be the case for tax year
2006/07 and/or 2007/08) the £25,000 annual limit does not
apply to “pre-announcement losses” for that period.
Guidance on calculating ‘pre-announcement losses’
for basis periods straddling 2 March 2007 is at
BIM72612.
