Skip to content

ACCA Applied Skills · Taxation (UK) · Gains and losses on the disposal of movable and immovable property

Nadia, a UK resident individual, made an allowable capital loss of £5,000 in 2026/27 and no gains in that year. She made a gain of £12,000 in 2027/28. What is the position regarding her 2026/27 loss?

The loss is carried forward and used in 2027/28 only as far as needed to reduce the gain to the annual exempt amount. Capital losses cannot be set against income and do not expire, so the £5,000 loss is fully used against the £12,000 gain.

  1. AIt is carried forward and used in 2027/28 only to reduce the gain to the annual exempt amountCorrect
  2. BIt is carried forward and set against the whole 2027/28 gain, ignoring the annual exempt amount
  3. CIt is set against her income for 2026/27
  4. DIt is lost because there were no gains in 2026/27

Explanation

A loss unused in the year is carried forward indefinitely and used against later gains only to the extent needed to reduce them to the annual exempt amount. Here £12,000 - £3,000 = £9,000 exceeds the £5,000 loss, so all of it is used. It cannot be set against income, and it is not lost.

Did you get it right without looking?

One question tells you little. A timed set on Gains and losses on the disposal of movable and immovable property shows your real accuracy, how long you take and where you lose marks.

Practise Gains and losses on the disposal of movable and immovable propertyFree diagnostic mock

More Gains and losses on the disposal of movable and immovable property questions