Share this content
0
310

Sideways loss relief

Didn't find your answer?

Search AccountingWEB

Sole trader has £3k losses brought forward and £2k 2018-19 losses.  Also pension income in excess of personal allowance.

I assume I can use the current year losses of £2k against the pension income and that the £3k losses are still carried forward against future trading profits?

Taxfiler carries the £3k losses forward but it also lets me use them in 18-19 instead which I think is incorrect.

Thanks for your help.

Replies (12)

Please login or register to join the discussion.

avatar
By nick farrow
10th Sep 2019 17:00

Paragraph 6 seems to say that losses brought forward can in practice only be used against profits of the same trade:

https://www.gov.uk/government/publications/losses-hs227-self-assessment-...

Thanks (0)
Replying to nick farrow:
avatar
By Matrix
10th Sep 2019 17:33

Thanks and agreed. But are they still carried forward if not used in 18-19 and current year losses used as sideways relief? I think so but was wondering if any thoughts.

Thanks (0)
Replying to Matrix:
avatar
By nick farrow
10th Sep 2019 17:57

I am sure the brought forward losses can be carried forward (even where current year losses used in year) but can't give chapter and verse right now

Thanks (0)
Replying to Matrix:
avatar
By nick farrow
10th Sep 2019 17:57

I am sure the brought forward losses can be carried forward (even where current year losses used in year) but can't give chapter and verse right now

Thanks (0)
RLI
By lionofludesch
10th Sep 2019 17:25

I take it these £3000 brought forward losses are trading losses.

Yes - ran it through Taxfiler myself. It'll let me choose anything from £0 to £5000 (to be fair, I haven't tried all 5001 options) but, imho, £2000 is the mnaximum.

Thanks (0)
Replying to lionofludesch:
avatar
By Matrix
10th Sep 2019 17:35

Yes they are trading losses. So Taxfiler lets you claim them which is odd. You choose the amount to use against other income which is dangerous.

Do you agree the losses still are available for c/f notwithstanding the 2018-19 loss used as sideways relief?

Thanks (0)
Replying to Matrix:
RLI
By lionofludesch
10th Sep 2019 18:05

Yes. £3000 to carry forward.

Thanks (0)
avatar
By Wanderer
10th Sep 2019 17:41

BTC won't allow an entry above £2k.

The £3k prior year losses are available to carry forward.

Thanks (0)
avatar
By Tax Dragon
11th Sep 2019 09:18

I have a similar issue with CT and a mixture of brought forward (pre- and post-2017) losses and deficits of various descriptions, CY losses and CY profits. Software basically seems to let me do whatever I want.... which is great, but unhelpful, as I'm sure I'm not legitimately able to do most of it. Working out what is legitimate is not easy.

In your scenario I agree with the others.

Thanks (0)
avatar
By Matrix
12th Sep 2019 13:17

Thanks all.

Tax Dragon, the software is just testing you. I certainly think you need to know what you are doing, it is not as simple as data input. Which means a lot of output must be rubbish.

Thanks (0)
Replying to Matrix:
By SteLacca
12th Sep 2019 15:55

That can't be right, Matrix. All the IT companies keep advertising how they make it so easy to get right.

Thanks (1)
Replying to Matrix:
RLI
By lionofludesch
12th Sep 2019 17:52

Matrix wrote:

Thanks all.

Tax Dragon, the software is just testing you. I certainly think you need to know what you are doing, it is not as simple as data input. Which means a lot of output must be rubbish.

Aye - folk used to laugh at me for working the tax out by hand before I loaded it into the software.

They're not laughing now.

Thanks (0)
Share this content