UKFTT 39 (2010) Barnett v HMRC

CGT, relief for future loss - HMRC won

Case Summary:

Mr Barnett made a capital gain. After enquiry it was agreed it should be increased. He suggested that if he sold some shares, he’d make a loss and that loss could reduce the gain- in an earlier year- to NIL. HMRC refused. Mr Barnett said this was unfair and unreasonable. The First Tier Tribunal agreed with HMRC that capital losses can’t go back and anyway they were hypothetical .

The First Tier Tribunal helpfully pointed out:

“The position might be different if the Appellant were to make, and the Respondents were to accept, an out of time claim that the shares in question were of negligible value in the year of assessment 2005/06, so that the Appellant could be treated as having made an allowable loss in that year, which was sufficient to reduce the chargeable gain on the disposal of the maisonette by the amount required.”