I'm sorry, but another FHL question (I know!)

Abolition of CAs following Budget

Didn't find your answer?

I have a chunk (£6k) of unused CA's in my pool that will go to waste at the end of tax year 24/25 because I have been using up brought forward FHL trading losses instead.  Following the change in rules recently announced I would like to re-open my 2022/23 tax return and use 18% WDA from my pool instead of losses which I will carry forward and use on my 2023/24 and/or 2024/25 returns, thus squeezing an extra year of WDA from my pool before it goes to waste at 05/04/25.

My question is, is this allowed or should I use trading losses up before claiming WDA's?   I always assumed WDA'a would get used up one day in the future so have been leaving them in the pool (using trading loss instead) but now wonder if that was foolhardy?

Thanks anyone who can advise.

Replies (6)

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By Paul Crowley
02nd Apr 2024 13:39

No idea why you have not been claiming the WDA.
In your circumstances I would have claimed maximum CAs in year of purchase as this just adds to the losses carried forward. WDAs are limited to the percentage once losses are used up. It takes ages to get to the lower limit that can be just claimed as a lump.
I do not have any clients in your position, so have not paid any attention to what happens to unused allowances.
You can amend your tax return for up to one year after the filing deadline.

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Replying to Paul Crowley:
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By David Ex
02nd Apr 2024 13:54

Paul Crowley wrote:

No idea why you have not been claiming the WDA.

I think we do. Badly advised or most likely not advised at all!

Have the draft legislation/ transitional measures been published?

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Replying to Paul Crowley:
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By David Ex
02nd Apr 2024 13:54

Duplicate

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Replying to David Ex:
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By Paul Crowley
02nd Apr 2024 14:03

I think not. But I would be amazed if the balance could not be relieved, as it is similar to the cessation of trade
https://www.aspects-holidays.co.uk/blog/owners-news/guide-to-the-aboliti...

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By Hatter73
02nd Apr 2024 14:13

Thanks both very helpful.

Not advised at all is the obvious answer. However, by correcting my 22/23 ITR and claiming WDA's for 23/24 and 24/25 I will almost have caught up anyway, and the tax lost on any foregone CA's (absent any relief for balance under cessation) will be less than the cost of the professional advice I never took!

Thanks again.

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Replying to Hatter73:
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By FactChecker
02nd Apr 2024 15:33

It'll certainly be more than the amount you've spent on getting 'confirmation'!
But, by the skin of your teeth by the sound of it.

Of course some people just love those endorphins - although I'd have thought you get enough on a regular basis at Kenilworth Road? :=)

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