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reposting, hopefully formatting will save... admin, please delete last post https://community.hmrc.gov.uk/customerforums/cgt/975fb946-af00-ee11-a81c-002248c5fd92 Hello, I was told that capital losses (from buying or selling on the stock market) brought forward from previous tax years are used in future tax years before the annual capital gain allowance can be used. Meaning that the capital losses brought forward are used first to reduce capital gain then if there is any capital gain left then the allowance can be used. however I cannot find a source online to confirm that is the case. In fact, it appears to be the other way around, meaning that the allowance is used first and if there is any taxable capital gain above the allowance then the capital losses brought forward can be used. I was able to find confirmation that capital losses brought forward are used after the allowance to not waste the allowance, see below example with source: https://www.taxinsider.co.uk/using-capital-losses-ta Is the below calculation correct? Year: 2017/18 Gains: Nil Losses: £8,000 Annual exemption: £11,300 Year: 2018/19 Gains: £20,000 Losses: £5,000 Annual exemption: £11,700 2017/18 Gains chargeable to capital gains tax: Nil Losses carried forward to future years: £8,000 The annual exemption is lost. 2018/19 Gains chargeable to capital gains tax: £20,000 Less: losses of same year: (£5,000) Net: £15,000 Less: losses brought forward: (£3,300)* Net: £11,700 Less: annual exemption 2018/19: (£11,700) Net chargeable gains: nil *The capital losses brought forward from 2017/18 of £8,000 are restricted in their offset to £3,300, so as to ensure none of the annual exempt amount of £11,700 is wasted. The unutilised £4,700 (i.e. £8,000 less £3,300) of the £8,000 of capital loss brought forward is eligible for carry forward to 2019/20 and future tax years.

Hello, I was told that capital losses (from buying or selling on the stock market) brought forward from previous tax years are used in future tax years before the annual capital gain allowance can be used. Meaning that the capital losses brought forward are used first to reduce capital gain then if there is any capital gain left then the allowance can be used. however I cannot find a source online to confirm that is the case. In fact, it appears to be the other way around, meaning that the allowance is used first and if there is any taxable capital gain above the allowance then the capital losses brought forward can be used. I was able to find confirmation that capital losses brought forward are used after the allowance to not waste the allowance, see below example with source: (Link removed by Admin)  Is the below calculation correct? Year: 2017/18 Gains: Nil Losses: £8,000 Annual exemption: £11,300 Year: 2018/19 Gains: £20,000 Losses: £5,000 Annual exemption: £11,700 2017/18 Gains chargeable to capital gains tax: Nil Losses carried forward to future years: £8,000 The annual exemption is lost. 2018/19 Gains chargeable to capital gains tax: £20,000 Less: losses of same year: (£5,000) Net: £15,000 Less: losses brought forward: (£3,300)* Net: £11,700 Less: annual exemption 2018/19: (£11,700) Net chargeable gains: nil *The capital losses brought forward from 2017/18 of £8,000 are restricted in their offset to £3,300, so as to ensure none of the annual exempt amount of £11,700 is wasted. The unutilised £4,700 (i.e. £8,000 less £3,300) of the £8,000 of capital loss brought forward is eligible for carry forward to 2019/20 and future tax years.