Income Tax Act 2007 section 92

Use of trade-related interest and dividends if trade profits insufficient

Section 92 deals with how certain trade-related interest and dividends can be treated as trade profits when there are insufficient profits to fully absorb terminal trade loss relief.

• Where terminal trade loss relief cannot be fully used because trade profits are nil or insufficient, trade-related interest and dividends may be treated as trade profits
• Only interest and dividends that arise in the relevant tax year qualify for this treatment
• The interest or dividends must be of a nature that would normally be included in calculating trade profits, but have instead been taxed separately under other income tax provisions
• This provision ensures that terminal trade losses are not wasted simply because income connected with the trade has been taxed under a different heading