# Income Tax (Trading and Other Income) Act 2005, Section 272A: Restricting deductions for finance costs related to residential property

Extent: E+W+S+N.I.

(1) Where a deduction is allowed for costs of a dwelling-related loan in calculating the profits of a property business for the tax year 2017-18, the amount allowed to be deducted in respect of those costs in calculating those profits for income tax purposes is 75% of what would be allowed apart from this section.
(2) Where a deduction is allowed for costs of a dwelling-related loan in calculating the profits of a property business for the tax year 2018-19, the amount allowed to be deducted in respect of those costs in calculating those profits for income tax purposes is 50% of what would be allowed apart from this section.
(3) Where a deduction is allowed for costs of a dwelling-related loan in calculating the profits of a property business for the tax year 2019-20, the amount allowed to be deducted in respect of those costs in calculating those profits for income tax purposes is 25% of what would be allowed apart from this section.
(4) In calculating the profits of a property business for income tax purposes for the tax year 2020-21 or any subsequent tax year, no deduction is allowed for costs of a dwelling-related loan.
(5) Subsections (1) to (4) do not apply in relation to calculating the profits of a property business for the purposes of charging a company to income tax on so much of those profits as accrue to it otherwise than in a fiduciary or representative capacity.
(6) For the meaning of “costs of a dwelling-related loan” see section 272B.
(7) See also section 307D (cash basis: modification of deduction for costs of loans).

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Source: https://www.legislation.gov.uk/ukpga/2005/5/section/272A (the official version)
Page: https://openlegislation.uk/income-tax-trading-and-other-income-act-2005/section-272A
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.