The Loss Relief Extension To Capital Gains

Many people are unaware that if a trading loss is claimed against other income, either for the current or previous year, then by election this can be extended to capital gains, resulting in a further refund of taxes.

This can be of considerable benefit depending on the circumstances.

The Loss Relief Extension:

John makes a loss in 2011/12 of £50,000.

His income in the same year from other sources is £30,000 and he has chargeable gains (after deducting the annual exemption) of £20,000.

His profit for 2012/13 is likely to be £10,000.

Clearly it is advantageous in this situation to relieve the loss sideways against and extend the claim to cover the capital gains.

 

 

 

 

 

 

 

Get Your Complimentary Copy of 101 WAYS TO BEAT THE TAXMAN

Click here to receive a free copy of 101 WAYS TO BEAT THE TAXMAN today!