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My clients purchased a property in a holiday complex in July 1990 and this was sold in October 2004. On completing the capital gains tax computation relating to the sale, it was discovered that the net rental income received on this asset had been shown on the clients' past income tax returns under 'other property income' whereas it should have been shown under 'income from furnished holiday lettings'. The situation was rectified on the 2004-05 income tax returns and relief allowed for that year and 2003-04.
My clients purchased a property in a holiday complex in July 1990 and this was sold in October 2004. On completing the capital gains tax computation relating to the sale it was discovered that the net rental income received on this asset had been shown on the clients' past income tax returns under 'other property income' whereas it should have been shown under 'income from furnished holiday lettings'. The situation was rectified on the 2004-05 income tax returns and relief allowed for that year and 2003-04.
However losses arose in earlier years but no relief had been claimed against other income on the mistaken belief that the income had not arisen from furnished holiday lettings.
A claim was made in December 2005 for the loss relief in each of the five years prior to 2004-05 under error or mistake claim (TMA 1970 s 33 as...
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