Film Losses

[despearate den]

An Inspector has confirmed that Film losses carried back cannot be repaid at 41% (40+1Class 4 NI) and is adamant he is correct.

I am aware that Losses for Class 4 NIC purposes are slightly different in that they can be carried forward, if the loss is not matched with income subject to Class4 .

Can someone clarify

[al_eebee]

If you are carrying back to a year pre the 1% higher NIC rate than I believe he is correct that you will only get 40% repaid in the stand alone claim, BUT going forwards for C4NIC purposes the loss set against other income on carry back will be available to reduce future C4 charges.

So in a way you are both right. He will repay 40% by stand alone claim and you will in future years set the losses off against other income chargeable to C4 and get you 1% in the future

[al_eebee]

Actually I should qualify that as I have assumed in the first answer that there was no income liable to C4NIC in the year to which the loss was carried back. If there was then to the extent that the losses are set off and there is no 1% HR charge you will have lost 1% refund

[despearate den]

The years carried back to are 2004/05 and 2003/2004 where the 1% was originaaly paid.

So you agree it s/b at 41%