Income Tax Act 2007 Schedule 2 paragraph 36

Losses in an employment or office

Paragraph 36 provides transitional rules for carrying back an employment or office loss from the 2007–08 tax year to the preceding 2006–07 tax year, ensuring that relief is given under the old ICTA rules that governed 2006–07.

• Where a loss from an employment or office arises in 2007–08, that loss may be relieved against general income of the earlier year 2006–07.
• If relief is claimed for 2006–07, it is given in the same way it would have been given under the old ICTA provision (section 380(1)(b) of ICTA), as though the Income Tax Act 2007 had not been enacted.
• Section 129 of the 2007 Act, which explains how employment loss relief works, must be read consistently with the old ICTA treatment when applied to the 2006–07 year.
• The restriction in section 72 of the Finance Act 1991 (which limits sideways relief for certain employment losses) applies to the claim as if it had been made under the old ICTA rules.