Income Tax (Trading and Other Income) Act 2005 (c. 5)

Part 3 U.K. Property income

Chapter 7 U.K. Adjustment income

Treatment of adjustment income and adjustment expense U.K.

333 Treatment of adjustment income U.K.

(1) Adjustment income is treated as arising on the last day of the first period of account for which the new basis is adopted.

(2) But if there is a change of basis resulting from a tax adjustment affecting the calculation of any amount brought into account in respect of depreciation, adjustment income is treated as arising only when the asset to which it relates is realised or written off.

(3) Adjustment income is treated for the purposes of [F1 Part 4 of ITA 2007](loss relief) as profits of the UK property business for the tax year in which tax is charged on it.

Textual Amendments

F1 Words in s. 333(3) substituted (6.4.2007 with effect as stated in s. 1034(1) of the amending Act) by Income Tax Act 2007 (c. 3), ss. 1027, 1034, Sch. 1 para. 511 (with transitional provisions and savings in Sch. 2)

334 Treatment of adjustment expense U.K.

(1) An adjustment expense is treated as an expense of the business arising on the last day of the first period of account for which the new basis is adopted.

(2) But if there is a change of basis resulting from a tax adjustment affecting the calculation of any amount brought into account in respect of depreciation, an adjustment expense is treated as arising only when the asset to which it relates is realised or written off.