CGT Question relating to Capital Loss Claim
Hello All,
I sold a company in July 2010, i now have to declare this and potentially pay CGT on the proceeds (Circa 12k liability). But i also had a company go into liquidation in March 2007 that i had 25k of paid up shares in, this was dissolved in March 2008. My question is can i claim capital loss on this investment from 2007 / 2008 to offset my CGT liability this year from the gain i have seen from selling my last company successfully. I understand there is a time limit to make a claim, please advice what this is if anyone knows, i have been getting conflicting advice. Some have said 5 yrs 10 mths others have told me 4 years, but its also unclear if this is from appointing a liquidator or from when it was officially dissolved, as i believe technically i still held shares until it was dissolved i understand there is a strong possibility of been able to make the claim.
Many thanks everyone.
4 years
Hi Max - You have to write to your inspector making the claim for the loss under TCGA 1992 s 16(2A). The time limit for making this is 4 years after the end of the year of loss (This is per Taxes Management Act 1970 s 43(1)). The 5 year rule was for claims made pre 1 April 2010 when it was 5 years after 31 Jan following the year of the loss.
So, as you say, the loss arose in 2007/08 and so you have a couple of months left. The loss will then be available to offset your 2010/11 gain.
By the way I'm sure you can also claim for the loss of any money you lent the company (s 253 of the 1992 Act) as long as it was a trading company, ie not an investment or property investment company.