I apologise for drafting a v poor question earlier. Hopefully this is a better explanation of my query.
Back in 2004/05 my client was a self employed mortgage broker. He earned approx £10k from a particular deal, which he recorded on his tax return as income but the debt was not paid at that time. My client knew the customer well and was prepared to wait. In 2007/08 my client ceased to be self employed and since then has no longer completed this section of the Self Assessment return. The debt remained unpaid and arguably my client should have claimed the debt as a bad debt at about this time. He did not however and in December 2010 the customer ceased to trade. My client has therefore lost £10k.
As he no longer is self employed he cannot, in my opinion, claim the bad debt as an expense through the self employed seciton of the SA return. He will have to write in and seek relief, but is he prevented from doing so by the 4 year time limit or could one could argue this is an accounting treatment matter and therefore the time limit does not apply.