Utilising self empoyed b/f losses in SA

Utilising self empoyed b/f losses in SA

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I have a new client who runs a Zumba business in addition to her regular day job. She spends more than 10 hours per week on this, so I believe she qualifies for loss relief.  She started her business in 2012-13 and has made losses each year so far:

£1369 in 2012-13

£113 2013-14

£748 in 2014-15 which I am currently doing

The previous accountant did not claim loss relief for the b/f total losses of £1482, and I would like to claim relief on them this year.  Can I do this?  From what I read I think the answer should be yes, but I can't figure out how to put it into the tax return without generating errors.  It will let me claim for the £748 this year.

Could someone tell me if I can indeed claim relief on this tax return on losses from 2012-13 and 2013-14?  And if so how to put this in on the tax return so that it doesn't generate errors?

Thanks!

Replies (8)

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By Tim Vane
05th Jan 2016 15:55

I have two things to say.

Number one. You should not be doing other peoples' tax returns.

Number two. She has a regular day job. Both you and her previous accountant may have been able to claim loss relief if either of you knew what you were doing.

 

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By lindsayglover77
05th Jan 2016 16:42

Anyone actually able and willing to help?

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By K81
05th Jan 2016 16:52

probably yes

providing the losses were not set against PAYE income you can bring the losses forward & enter onto the tax return BUT you cannot use them against the 2015 PAYE income, you can only set the 2015 losses against the 2015 PAYE income the brought forward losses can only be set against income from the self-employment.

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paddle steamer
By DJKL
05th Jan 2016 16:53

To expand upon Tim's point above , you need to differentiate losses arising in the year with those brought forward  and be very comfortable understanding how each may be used and the time limits to use them/vary previous returns etc This tends to require studying the subject and working supervised in practice to gain experience.

As a pertinent associated point I read somewhere, years ago, that the highest incidence of PI claims against accountants arose from loss claims not made in time, something that has stuck in my head and constantly reminds me that where losses are concerned check, check and check again.

( E.g. How many people forget to c/fwd the class IV loss for those losses used sideways against non trading income)

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Replying to lionofludesch:
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By v.knazevs
05th Jan 2016 17:00

Great point

DJKL wrote:

( E.g. How many people forget to c/fwd the class IV loss for those losses used sideways against non trading income)

This needs to be put on stick it note and sticked to my monitor.

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Stepurhan
By stepurhan
05th Jan 2016 16:56

B/F losses

You can't offset prior year trading losses against other income.

But, as Tim has suggested, that is pretty basic tax knowledge. If you can't even answer this question for yourself then you should not be preparing returns for others.

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paddle steamer
By DJKL
05th Jan 2016 16:57
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By lindsayglover77
05th Jan 2016 17:08

Thank you

Appreciate the guidance thank you.

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