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Self-Employment Income Support Scheme: losses

Losses from 2017-2018 reduce taxable profits to zero in 2018-2019 - use profit before losses?

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My client made a loss in 2017-2018 so the loss reduced the taxable profit in 2018-2019 which afterwards was lower than her other income. As the loss was in 2017-2018 it doesn't appear right to use it in calculating the taxable profit in 2018-2019 to see whether her self employed income was below 50% of her total income. I can see that the average profit for the three years should include the negative figure in 2017-2018 though.

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By Wanderer
14th May 2020 02:39

Don't you need to work through the interaction of Sections 7 & 8 of the regulations and Step 1 of section 23 of ITA 2007?

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By petersaxton
19th May 2020 09:22

Yes, I did. Trading losses only affect the year they were made.

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By Wanderer
19th May 2020 09:50

Okay, it's hard to work out what you are doing without the figures however from the information given I think you now need to work through the profits conditions A, B & C in regs 5.2, 5.3 & 5.4.

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