Marj

Thank you for your reply. So just to clarify, to make sure I'm understanding this correctly: 1. When it comes to losses carried forwards for my self employed business – am I correct in thinking these losses can be carried forwards indefinitely until they are used up against profit in the same trade? 2. Also, am I correct in thinking that this means losses carried forwards can be set off against profit, even if the loss carried forward originally arose more than 4 years ago? Thanks for your help.

Thanks for your reply. Could you please clarify something I'm confused about? The first reply I received earlier in this thread said, from HMRC Admin 10 said: 'Any losses must be used within 4 years from the end of the year in which the loss arises.' The last reply from HMRC Admin 19, said: 'Losses carried forward do not expire. They continue being carried forward indefinitely, until they can be used.' Could you please clarify what the 4 year time limit applies to, if losses carried forward can be used indefinitely? Thank you.

Hello, thanks very much for your reply. I have a couple of further questions: 1. My understanding is that losses carried forward expire if they are not used within 4 years. Can I double check if declaring a combined loss from multiple years in box 35 resets the 4 year counter for all losses carried forward? Or do losses carried forward expire 4 years after the tax year each loss arises? 2. If unused losses do expire after 4 years of arising, and I have combined losses carried forward from multiple years, would I subtract any expired amount year by year, and carry forward the rest to use in future years? Thanks for your help.

Hi, Thanks very much for your reply and for the information. Could I clarify a few additional points with you: 1. If the profit made in a tax year is less than the losses carried over from previous years, what happens to unused losses? Should I subtract the amount set against this year's profit from the total losses carried forwards, and can I then continue to carry forwards the remaining losses until they are set against future profit in the same trade (as long as it's still within 4 years of the loss arising)? 2. As the profit this year is less than the total losses carried forwards from previous years, next year if there is a loss again rather than a profit, would I be able to continue to add to the total amount of losses carried forward, and use them against profits in a future year? 3. Can I double check I'm putting my figures for this in the right place on my tax return? -For the amount of losses brought forward to set-off against this year's profit, would I place this here: Correct adjustments section: - Box: 29: 'Loss brought forward from earlier years set-off against 2021-22 profits' -For the revised amount of total losses to carry forward for future years, would I place this here: Losses section: Box: 35: 'Total loss to carry forward after all other set-offs including unused losses brought forward' 4. With profit and loss each year, does it work the same way if you carry forward losses, regardless of how many years you've been self employed? Thanks again for your help.

I've been self employed since the 2018/19 tax year. The last three tax years I've recorded a loss to carry forward on my self assessments for the same trade. For the 2021/22 tax year, I've recorded a profit - however the profit is less than the total loss I've carried over from previous years. Also, I'm still within my personal allowance with this year's profit. - I've read the guidance on loss carried forward and relief against profit in the same trade, however I have some questions I'd appreciate your help with: 1. Do l need to set-off the portion of losses carried forward against the profits in this 2021/22 tax year - or is it possible to still carry the whole amount forward to a future tax year - since I am still below my personal allowance for this year? 2. If I do need to set-off the portion of the losses I've carried forward against the profit in this 2021/2022 tax year, should I subtract the amount for this year's profit and then carry the remaining amount of unused losses to future years, or does it work in another way? 3. Is there a time limit to how long losses carried forward can be applied to profit from the same trade? 4. In the self assessment help information, it says 'You can carry your loss, or the amount of loss remaining unused, forward to set against future profits from the same business. The loss is deducted from your profits in that business in the first and each subsequent year until it is used up.' - Can I clarify what would happen if there was no profit in a subsequent year? Would the unused losses still continue to carry over to a future year until the total amount is used up? - Also, if there is a loss again rather than a profit, could I continue to add to the total amount of losses carried forward and use them against profits in a future year? Thanks for your help!