Taxes Consolidation Act 1997 section 381

Right to repayment of tax by reference to losses

Section 381 provides relief for losses sustained in a trade, profession or employment by allowing the loss to be set sideways against the taxpayer's other income for the same year of assessment.

• A person carrying on a trade, profession or employment — solely or in partnership — who sustains a loss in a year of assessment may claim repayment of income tax by deducting the loss from their total income for that year.
• The loss is applied first against the taxpayer's own appropriate income (earned or unearned, matching the nature of the loss), then against other own income, then against the corresponding income of a spouse or civil partner, and finally against the spouse's or civil partner's remaining income; once a claim is made, the full loss must be used — a partial claim is not permitted.
• Losses from stallion stud fees were excluded from relief prior to 1 August 2008, when such income was tax-exempt; losses arising on or after that date are allowable, with a time-apportionment formula applying to accounting periods that straddle the changeover date.
• A claim must be made on the prescribed form within two years of the end of the year of assessment; the loss cannot be used twice, and appeals against Revenue determinations lie to the Appeal Commissioners within 30 days.