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Where Taxpayers and Advisers Meet

Early years loses

Arjun
Posts: 8
Joined: Tue Aug 23, 2016 5:05 pm

Early years loses

Postby Arjun » Wed Oct 10, 2018 10:35 pm

A sole trader made a loss in the first year and therefore qualified for special rules and took the loss 3 years back in FIFO basis.

Second year, he also made loss and wants to carry back another 3 years to claim the tax that is paid to be refunded.

Is this doable?

Kind regards

Arj

robbob
Posts: 2606
Joined: Wed Aug 06, 2008 4:01 pm

Re: Early years loses

Postby robbob » Thu Oct 11, 2018 9:27 am

Without doing checking full chapter and verse i am pretty certain the same principle applies to y2 as to y1 - with the caveat that the 3 years applies to the "year of the loss" so the year that is four years ago from the second year that will be out of bounds for y2 claims that same year would have been fine to use for y1.

Hmm additional note - your calcs will be based on "what is left" after your first carry back that has already been done -for year 1 . I.e you cannot reduce the same income of earlier year twice, you can though make two separate reductions of that earlier years income - hopefully that makes some sort of sense.

Ps remember losses can be carried forward for class 4NI purposes if not used in carry back.

Arjun
Posts: 8
Joined: Tue Aug 23, 2016 5:05 pm

Re: Early years loses

Postby Arjun » Fri Oct 12, 2018 4:44 am

Many thanks Robbob.


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