Income Tax Act 2007 section 74B

No relief for tax-generated losses

Section 74B previously denied loss relief for losses arising from tax avoidance arrangements, but has now been repealed.

• Section 74B was introduced by Finance Act 2008 to prevent individuals claiming sideways loss relief or capital gains relief for losses generated through tax avoidance schemes.
• The section targeted "tax-generated losses" — losses that arose from arrangements whose main purpose, or one of whose main purposes, was to obtain a reduction in tax liability through the use of those losses.
• Section 74B was subsequently repealed by Finance Act 2010, with consequential amendments made to the related sections 74C and 74D of the Income Tax Act 2007.
• The repeal formed part of a broader restructuring of the anti-avoidance rules around sideways loss relief, rather than a relaxation of the restrictions on tax-motivated losses.