Income Tax (Trading and Other Income) Act 2005 section 845C

Effect of claim, foreign employment election or foreign gain claim on losses

Section 845C prevents individuals who have claimed the remittance basis from obtaining tax relief for losses arising from businesses operated entirely outside the United Kingdom.

• Applies to individuals carrying on a trade, profession, vocation or property business wholly outside the UK who make a foreign income claim, foreign employment election or foreign gain claim for a tax year.
• If the individual has a loss from that overseas business in the relevant tax year, and the profits of the business (had there been any) would count as qualifying foreign income, the loss restriction applies.
• No relief for that loss is available in the tax year of the claim or election, nor in any other tax year — the loss is effectively extinguished entirely.
• A "relevant business" for these purposes means a trade, profession or vocation, or a property business.

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