Good morning
2015 tax return had a Capital Gain of £256,119. £250,000 of this was based on an earn out which at the time was considered achievable and capped at that level.
The earn-out has not been achieved and had been withdrawn, leaving the gain at £6,119.
My question is what is the correct way of putting this through the return?
From my initial reading on HMRC, it would appear that I treat the £250,000 loss of earn-out, as the capital loss in this year and elect for it to be accrued against 2015 tax paid.
There are also mentions of adding an explanatory letter to the tax return, is this required?
Any initial guidance would be most appreciated.
Many thanks
Andy
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