CG15104 | Deferred consideration: unascertainable: election for treatment of loss - loss exceeds first year limit

TCGA92/S279C

Where the amount of the relevant loss exceeds the first year limit, and there is at least one intervening year of assessment between the first eligible year and the year of the loss, no part of the relevant loss which remains unused in the first eligible year can be deducted in accordance with TCGA92/S2(2)(b) from chargeable gains of any intervening year unless the intervening year in question is an eligible year, see CG15086.

This requirement restricts the use of any unused part of the relevant loss in intervening tax years to those years in which chargeable gains falling within subsection (3) or (6) of TCGA92/S279A, see CG15085 to CG15087, accrued to the taxpayer and for which he had a residual CGT liability, see CG15086, immediately before the election was made.

Any part of the relevant loss which is unused in the first eligible year and which cannot be used in any subsequent eligible year is carried forward to the year of the loss and, to the extent that it is not deducted from chargeable gains in accordance with TCGA92/S2(2)(b) in that year, is carried forward to tax years following that year. There is an upper limit on the amount of the relevant loss that can be deducted from chargeable gains in eligible years after the first eligible year, see CG15105.