This is a freeview 'At a glance' guide to loss relief for loans and shares.

What loss relief is available when assets become worthless, lost or destroyed? Subscribers see Loss relief (income tax) disposal of shares and CGT: Relief for loans to traders.

Where an asset becomes worthless or is lost or destroyed it is generally possible to claim loss relief on the cost of the asset.

  • For some assets such as shares, there is a choice as to whether the loss claim is made under Capital Gains Tax (CGT) rules, or Income Tax rules.
  • Loss relief for CGT is given by section 24 TCGA 1992.
  • If the asset consists of shares subscribed for in a private or AIM-listed company or Enterprise Incentive Scheme (EIS) or Seed Enterprise Investment Scheme (SEIS) company, the loss as calculated for CGT may alternatively be claimed against income (section 131 ITA 2007).

See Loss relief (income tax) disposal of shares

If an asset was a loan made by a trader to his business (this includes his company, as well as any sole trade or partnership) and it becomes irrecoverable, he may also claim CGT loss relief under section 253 TCGA 1992.

  • There is also relief when an individual acts as a guarantor.

See CGT: Relief for loans to traders

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