Section 116A | Excess loss allocation to partners who are individuals ^F1

(1)Subsection (2) applies if—^F1

(a)in a tax year, an individual (“A”) makes a loss in a trade as a partner in a firm, and^F1

(b)A's loss arises, wholly or partly—^F1

(i)directly or indirectly in consequence of, or^F1

(ii)otherwise in connection with,^F1

relevant tax avoidance arrangements.

(2)No relevant loss relief may be given to A for A's loss.^F1

(3)In subsection (1)(b) “relevant tax avoidance arrangements” means arrangements—^F1

(a)to which A is party, and^F1

(b)the main purpose, or one of the main purposes, of which is to secure that losses of a trade are allocated, or otherwise arise, in whole or in part to A, rather than a person who is not an individual, with a view to A obtaining relevant loss relief.^F1

(4)In subsection (3)(b) references to A include references to A and other individuals.^F1

(5)For the purposes of subsection (3)(b) it does not matter if the person who is not an individual is not a partner in the firm or is unknown or does not exist.^F1

(6)In this section—^F1

“arrangements” includes any agreement, understanding, scheme, transaction or series of transactions (whether or not legally enforceable), and

“relevant loss relief” means—

(a)sideways relief,

(b)relief under section 83 (carry-forward trade loss relief),

(c)relief under section 89 (terminal trade loss relief), or

(d)capital gains relief.

(7)This section applies to professions as it applies to trades.^F1