PIM4205 - Losses: overview
ITA07/Chapter 4 Part 4
Where a property business makes a loss, there are generally two ways in which these can be relieved:
Losses made in one property business can鈥檛 be carried across to any other property business the customer carries on at the same time in a different legal capacity (see PIM1020).
For details of post-cessation property relief see PIM2510.
For guidance relating to the corporation tax treatment of听losses arising in a property business carried on by a company, see听PIM4230听辞苍飞补谤诲蝉.
Uncommercial losses
All the loss relief rules apply where the loss arises from ordinary commercial letting. Expenses of properties that are let on uncommercial terms (for example, at a nominal rent to a relative) can only be deducted up to the amount of the rent or other receipts generated by the uncommercially let property. The excess of the expenses over the receipts from the uncommercially let property can鈥檛 be deducted in the property business and can鈥檛, therefore, create a loss (PIM2130).
4-year FIG regime from 6 April 2025
A person who makes a claim to relief under the 4-year FIG regime (see听PIM4702) may not claim relief for losses in respect of their overseas property business in that tax year and the carried forward losses of their overseas property business are treated as nil. See ITTOIA05/S845C.