Registering loses from previous years

by **muldoon** on Tue Jan 31, 2012 8:40 pm

Good evening - hopefully a simple query from me.
This last tax year (2010-2011) I made a profit on share delaing of about £25,000. I have not yet declared this, and was hoping to offset the CGT due against losses I made in share dealing in 2009-2010 (about £8,000) and 2008-2009 (about £30,000). However, I never registered the losses in those 2 years with HMRC - does this mean I will not be able to use them ?

by **mullet** on Tue Jan 31, 2012 8:55 pm

I have not yet declared this

Hurry up, you haven't got long.

All is not lost (pun intended). Losses made since 1996–97 must be notified to HMRC within four years of the end of the tax year in which they were made. So you are within that time limit for 2008-09 and 2009-10, notwithstanding the fact that such losses should really have been shown in the CG pages of the relevant tax returns. I would show the losses in your 2010-11 tax return and just accept the fact that you are more likely to face an enquiry into that year's tax return. As long as the losses can be satisfactorily evidenced, you shouldn't have anything to worry about.

Remember that brought forward losses are used in full or (if lower) to the extent that the gains of the year are reduced to that year's annual exempt amount.

Hurry up - you've got just over 4 hours!

by **muldoon** on Tue Jan 31, 2012 9:57 pm

Really ? I am not on self-assessment so surely the 4 hour deadline doesn't apply to me does it ? (I believe it has been extended by 2 days anyway due to an HMRC strike?). I was thinking that once a tax year ends (the 2010-2011 year ending in April 2011), then I had until April 2012 to declare anything that needs declaring - it seems I am wrong on this ? But if as you say I am still able to declare losses for 2008-9 and 2009-10 and use them in later tax years why should there be such a rush to declare 2010-11 ?

by **mullet** on Tue Jan 31, 2012 10:06 pm

I was thinking that once a tax year ends (the 2010-2011 year ending in April 2011), then I had until April 2012

Wrong.

But if as you say I am still able to declare losses for 2008-9 and 2009-10 and use them in later tax years why should there be such a rush to declare 2010-11?

Because I (naively) expected you to already be within the self assessment system. So let's start again ...

You are chargeable to capital gains tax on your share disposal(s) in 2010-11. The law states that you were required to notify chargeability within 6 months of the end of the tax year, 5 October 2011. I know that in practice you are not chargeable because of losses, but HMRC still expect you to declare the gains and show the losses. You need to contact HMRC (via the internet is possible) to register for self assessment and make a correct return for 2010-11. If you are not really sure what to do and/or not confident of making a complete and correct return, then I suggest that you get an accountant to help you.