Loss carry back claim

I want to check the process for making a claim for a 2022/23 loss against 2021/22 income. I have only done this once before, several years ago, and I can only remember getting it wrong. I think it goes like this: I amend the 2021/22 return to show the loss claimed under "income tax losses" in the box "relief claimed now for the tax year 2022/23". This will not change the tax calculation for 2021/22, because the relief is given in 2022/23. I then have to work out separately the difference to the 2021/22 tax liability if that loss had been a 2021/22 loss, and enter that figure in the box "decrease in tax due because of adjustments to an earlier year" on the 2022/23 return. I will also include details of the loss in the 2022/23 return but show it as claimed against 2021/22, so it will not be part of the tax calculation for 2022/23. The figure claimed will appear as an adjustment on the tax computation. Is that correct, or can you point out where I have gone wrong?

Hi,

You can refer to the following guidance, and in particular point 11:

HS227 Losses (2023)

Thank you.

Thank you for replying, but I am afraid the guidance is too brief to answer the question. First, I have done exactly what it says in the guidance, and the amount I have put in the box "decrease in tax due because of adjustments to an earlier year" DOES NOT APPEAR in the 2022-23 tax calculation - so it does not seem to have been taken into account, which suggests to me that I need to do something else. Second, I am not clear about whether I am also supposed to submit an amended return for 2021-22 showing the claim - the guidance does not tell me to do so, which suggests to me that I don't have to, but there are boxes on the return form for carried back losses, which suggests to me that I do. If there is more detailed guidance I will happily read it, but honestly this is not detailed enough.

Hi Michael Thexton,

It wont appear in the calculation as you are carrying it back.
Once you submit the return, it will put a credit on your record in respect of the loss in order to give you the refund.

Thank you.

 

OK, nearly there... the remaining part of the question still not answered: "Second, I am not clear about whether I am also supposed to submit an amended return for 2021-22 showing the claim - the guidance does not tell me to do so, which suggests to me that I don't have to, but there are boxes on the return form for carried back losses, which suggests to me that I do." Can you please clarify whether I need to do anything with regard to the 2021-22 return in respect of this 2022-23 loss, or just calculate the relief on the back of an envelope and put it in the "carry back" box on the 2022-23 return? If this seems like a stupid question... seriously, the guidance is not clear enough.

Hi,

If you are completing a paper tax return for 2022/23 to carry back losses to 2021/22, SA103(S) will need to show the loss to carry back in box 34 and in SA103(F) box 79.

In both cases, boxes 15 and 17 of SA110 also need to be completed. If this is done in the first capture of your tax return, a credit will be created and added to your Self Assessment statement.  

If this is done as an amendment to the original capture of the tax return, then it will need to manually calculated. You do not need to amend your 2021/22 tax return.

Thank you.

 

Thank you. Actually, I am filing a return online using the standard HMRC "system", so the box references to SA110 and 103(s) don't match up. BUT the main thing is that I don't need to amend the 2021/22 return - I will put the 2022/23 return in showing the amount to carry back and the amount I have calculated as a repayment due, and I will see if it works!