Hi,
This is my first query on here, so hello!
I think my accountant might have missed a trick on my previous years' tax returns, but I wondered if anyone could offer some advice? I've just started a business with my partner, into which we invested a lot of money from Oct 2017 to July 2019. Therefore, in its first two tax returns it had high capital allowances and net trading losses. In 2017/18 and the years before, I was a higher rate tax payer on PAYE and I earned a smaller amount of PAYE income in 2018/19.
What my accountant has done:
2017/18 - Taken a full £24k loss in the year (£22k of which is capital allowances expensed @ 100%) to offset income earned at the higher rate
2018/19 - Taken £13k of a total £20k loss (£16.5k of which is capital allowances expensed @ 18%) to offset PAYE income earned and to leave net earnings = £11,850. Carried forward £7k loss and a large amount of capital allowances
My questions:
1) Is what they have done OK? I was under the impression that losses had to be utilised in full, so should any of the 2018/19 loss have been carried forward? Also, the treatment of taking 100% capital allowances in 2017/18 and only 18% in 2018/19 seems odd to me.
2) Could they have used the 2018/19 loss to offset an earlier tax year instead where I paid higher rate tax?
3) If the answer to (2) is yes, can I resumbit my returns to change this? Including resubmitting 2017/18 presumably.
4) If I can't / don't want to resubmit, can I at least use the £7k carried forward loss to offset earlier year tax? And if so, how can I do this?
Many thanks in advance,
Steve
- Home
-
Tax News
- Budgets and Autumn Statements
- Income Tax
- Business Tax
- PAYE and Payroll Taxes, National Insurance, NICs
- Company Taxation
- Savings & Investments, Pensions & Retirement
- Capital Gains Tax, CGT
- Property Taxation
- Inheritance Tax, IHT, Trusts & Estates, Capital Taxes
- Tax Investigations & Enquiries
- VAT & Excise Duties
- Stamp Duty, Stamp Duty Land Tax, SDLT
- International Tax
- HMRC Administration, Practice and Methods
- Professionals in Practice & Industry
- General
- TaxationWeb
-
Tax Articles
- Budgets and Autumn Statements
- Income Tax
- Business Tax
- PAYE and Payroll Taxes, National Insurance, NICs
- Company Taxation
- Savings and Investments, Pensions and Retirement
- Capital Gains Tax, CGT
- Property Taxation
- Inheritance Tax, IHT, Trusts & Estates, Capital Taxes
- Tax Investigations & Enquiries
- VAT & Excise Duties
- Stamp Duty, Stamp Duty Land Tax, SDLT
- International Tax
- HMRC Administration, Practice & Methods
- Professionals in Practice & Industry
- General
- Tax Tips
-
Tax Forum
- Income Tax
- Business Tax
- PAYE and Payroll Taxes, National Insurance, NICs
- Company Taxation
- Savings & Investments, Pensions & Retirement
- Capital Gains Tax, CGT
- Property Taxation
- Inheritance Tax, IHT, Trusts & Estates, Capital Taxes
- Tax Investigations and Enquiries
- VAT & Excise Duties
- Stamp Duty, Stamp Duty Land Tax, SDLT
- International Tax
- HMRC Administration, Practices & Methods
- Professionals in Practice & Industry
- General
- Tax Jobs
- Get in Touch