Part 4Loss relief
Chapter 2Trade losses
Post-cessation trade relief
99Reduction of relief for unpaid trade expenses
(1)
This section applies for the purposes of post-cessation trade relief in respect of a person's trade if a deduction was made in calculating the profits of the trade for an expense not actually paid (an “unpaid expense”).
(2)
The amount of the person's relief for a tax year is reduced (but not below nil) by—
(a)
the total amount of unpaid expenses at the end of the tax year, or
(b)
if the person carried on the trade as a partner in a firm, the person's share of the total amount of unpaid expenses at the end of the tax year.
(3)
But any unpaid expense which is taken into account in reducing the amount of the person's relief for a tax year is left out of account in making reductions for subsequent tax years.
(4)
If the person actually pays an amount in respect of an unpaid expense taken into account in reducing the amount of the person's relief, the person is treated as making a qualifying payment for the purposes of section 96.
(5)
The amount of the qualifying payment is—
(a)
the amount actually paid, or
(b)
if less, the amount of the reduction.
(6)
This section applies to professions and vocations as it applies to trades.