loss on trade but profit on rental income ct600 help needed | AccountingWEB

# loss on trade but profit on rental income ct600 help needed

we have  a small ltd company  client that made a small loss this year of 4845 . after adding back depreciation etc the adjusted loss becomes 2788.this obviously does not cause any problems when calculating the corp tax or refund due. they made a profit of 4000 last year.

this year they  now rent out the flat above the salon and receive 7800.

would i A) complete the ct600  showing a profit of 5012 (7800-2788) and calculate the tax due or B) would the loss of 2788 be increased by 7800, to make a trading and professional loss of  10588. then add back the rental income to be releived against current profit (the rent)  then  to make a trade  loss of 2788 that could be carried back and set   against the previous year's profit of  4000 . thus there would be a ct refund due on 2788 at last years rate (21%).

any help would be appreciated.

thanks

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