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Budget '08: Anti avoidance

18 March 2008
Categories: Comment & Analysis , HMRC powers
Details of anti-avoidance measures

Sideways loss relief

Finance Act 2007 s 26 and Sch 4 introduced legislation to counteract the use of partnership arrangements that generate trade losses for use as sideways loss relief by a non-active or limited partner.

HMRC have now decided to restrict the amount of sideways loss relief that can be claimed by an individual other than a partner carrying on a trade in a non-active capacity.

Where a loss arises to an individual carrying on a trade in a non-active capacity as a result of tax avoidance arrangements made on or after 12 March 2008 no sideways loss relief will be available for that loss.

Otherwise there will be an annual limit of £25 000 on the total amount of sideways loss relief that an individual may claim from trades carried on in a non-active capacity.

For these purposes an individual other than a...

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