Income Tax (Trading and Other Income) Act 2005 section 22A

Trading allowance

Section 22A establishes that the trading allowance rules take priority over the normal rules for calculating trading profits of an individual.

• The normal rules for calculating profits of a trade, profession or vocation carried on by an individual are overridden by the trading allowance rules.
• The trading allowance provides relief on an individual's relevant trading income.
• Where trading allowance relief is claimed, most expense deductions that would normally be available are disallowed.
• The individual must choose between claiming the trading allowance or deducting actual expenses — they cannot benefit from both.