Property losses

The taxpayer’s self assessment returns showed losses for the two years ended 5 April 2007 and 5 April 2008. She claimed the losses against her general income for each year.

HMRC agreed the losses arose in connection with her activities in relation to 11 residential properties she owned but said they were not trading losses.

The taxpayer appealed.

She said she began buying properties in 2002 with the intention of selling them on for a profit. However because of the downturn in the property market she decided to let them instead.

The First-tier Tribunal said that while the taxpayer’s original intention may have been to buy properties and sell them on quickly the fact that she continued to buy houses indicated she had reconsidered and decided instead to keep the properties and let them...