- Jane's normal accounts made up to 31 December.
- She closed her business 30 September 2015, final 21 months loss is £21,000
- Her terminal loss, final 12 mths is 12/21 x £21,000 = £12,000
- She will have other income in 2015/16 and so would like to make a Section 64 claim for the 2015/16 loss against the 2015/16 general income.
I have considered making a S64 claim for 2014/15 loss to be carried back to 2013/14 but the tax involved is not attractive.
My concern is:
- If I claim the terminal loss relief of £21,000 then it was computed as if the final 12 months of trading. This appears to prevent me using the 2015/16 loss (final 6 months April to September 2015) against the general income 2015/16. The loss appears to be based on the same period.
- There appears to be wasted loss relief of £21,000 less £12,000 = £9,000.
I know one cannot claim a loss more than once, but it seems harsh that on a loss of £21,000 a large part may be wasted.
HMRC manuals BIM85080, 85055 and 85015 do not appear to answer my point, nor does online research.