Income Tax Act 2007 section 81

Dealings in commodity futures

Section 81 restricts sideways loss relief where an individual carries on a trade of dealing in commodity futures through a partnership that includes a company, and arrangements exist to exploit loss relief to reduce tax.

• This section targets trades involving dealing in commodity futures carried on in partnership with a company.
• Sideways relief is denied where arrangements have been made to secure a reduction in tax liability through that relief.
• The restriction applies to individual partners, preventing them from setting trading losses from such activities against their other income.
• The provision is an anti-avoidance measure aimed at partnerships between individuals and companies that are structured to generate loss relief benefits.