Self-employed losses

[agbrfas]

Self-employed trading losses can be used to reduce other taxable income in the year of loss. If there was a trading loss, but also a balancing charge in the same period arising from an asset sale, do these have to be considered together for loss purposes? The software I use seems to allow me to utilise the trading loss against other income and at the same time utilise brought forward losses to offset the balancing charge. I’m not sure if this is right, but can’t find specific guidance/rules on this. Any thoughts would be much appreciated.

[pawncob]

Brought forward losses can be offset against the chargeable income, which includes balancing charges.
Only current losses can be offset "sideways".

[agbrfas]

Thanks pawncob, but can the trading losses be considered separately from the balancing charge, or must they be looked at net? In the former event there will be sideways relief and utilisation of b/f losses, and so less tax payable.

[pawncob]

I think the legislation requires the "profit" to include C.A.s, so it would have to be the net which is subject to relief.

[LozaACCS]

You can elect whether to claim a CA and so manipulate the loss relief claim, I do not believe you could elect not to have a balancing charge (because you already have one) so the claim must be net