Net losses on self employment and rebate/refund from PAYE?

I’ve been filing returns for about 10 years, so all I’ve ever done is the same kind of simple return. Modest earnings on top of PAYE set against expenses. But now I’ve got a query about net losses. I have PAYE income from a main employer (through which I pay a lot of tax), and am also self-employed. Last year I posted a net loss of X, and was expecting to get a rebate but nothing arrived. (I presumed this was from some sort miscalculation on my part). This year, I have posted another loss of Y. But yet again, when I went to calculate my tax, HMRC said I owed them a small amount of tax, rather than them owing me. Am I right in thinking that the net losses of X and Y mean I’ve overpaid tax last year, and am set to do so this year, too? Ideally, I’d like a rebate for these losses. Does anyone have any idea what I need to do? Is there some box I’m supposed to tick, or form I’m supposed to fill out. Many thanks in advance for help.

Hi Vybarr Cregan-Reid,

You cannot set your self employed losses against your PAYE income if you are using the cash basis for accounting.
If using traditional accounting then you would claim the loss against other income on your return.
Further guidance is at HS227 Losses (2023)

Thank you.
 

I also have a question about this and was expecting a technician to call me about this, but it didn't happen. I have made a loss this year on my new business, but have paid more than £3000 in tax on my PAYE job. I did not use the cash basis for accounting. I expected to get tax back from my PAYE job but when I completed my self assessment, it did not mention getting any tax back. I have not submitted the return yet for this reason. Can I get tax back from my PAYE job, as Sole Trader is all personal finance?

Hi Bex,

If you made a loss on your 22/23 self employment, you declare the loss in the tax return.  
You can then elect to set the loss aginst other income in 22/23, by completing box 33 of page SES2 on SA103S box 78 on SA103F) or the online equivalent.
Self-employment (Short) (2023)

Thank you.