Income Tax Act 2007 section 131

Share loss relief

Section 131 sets out the conditions under which an individual may claim share loss relief, including the types of shares that qualify and the kinds of disposal that are eligible.

• An individual who makes an allowable capital gains tax loss on disposing of qualifying shares may be eligible for share loss relief, allowing the loss to be set against income rather than just capital gains
• Qualifying shares are either shares attracting Enterprise Investment Scheme (EIS) relief or shares the individual personally subscribed for in a qualifying trading company
• The disposal must be at arm's length, as part of a company dissolution or winding up, or where the shares have been lost, destroyed, or have become of negligible value
• Share loss relief is not available where the loss arises from a share exchange or reconstruction arrangement that triggers a disposal only because anti-avoidance rules apply to the transaction