Income Tax Act 2007 section 37

Loss relief against miscellaneous income: Case VI losses

Section 37 provides transitional rules allowing losses from transactions that would formerly have been taxed under the old Case VI of Schedule D to be carried forward and relieved under the current rules for miscellaneous income losses.

• The provision applies to losses arising from transactions that, had they been profitable, would have been taxable under Case VI of Schedule D for any tax year before 2005-06.
• The transaction must not have fallen within sections 34, 35 or 36 of the Income and Corporation Taxes Act 1988 (ICTA), which dealt with certain specific categories of income.
• Any part of the loss for which relief has not already been given is treated as available for deduction under section 153 of the Income Tax Act 2007, which governs relief for losses from miscellaneous transactions.
• This is a transitional measure ensuring that pre-2005-06 Case VI losses are not lost when the tax system moved away from the old Schedule D framework.