Trading losses, reliefs and winding down
A loss is only worth what you can do with it. These guides cover carry-back against carry-forward, overlap relief on a change of basis period, pre-trading expenditure, abandonment losses on failed investments, and how to time a cessation so the final year does not cost more than it should.
8 guides in this topic.
Trading Losses: Carry-Back vs Carry-Forward — Which Suits You?
When your business makes a loss, HMRC gives you choices about how to use it — and the right choice can mean thousands of pounds back in your pocket. This guide breaks down carry-back and carry-forward strategies for sole traders and limited company directors, so you can make the most tax-efficient decision for your situation.
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Dissolution Relief: Cut CGT When Closing Your Limited Company
Closing your limited company doesn't have to mean a hefty tax bill. Dissolution Relief (formerly known as Extra-Statutory Concession C16) lets eligible directors extract final company assets at capital gains tax rates rather than income tax rates. Here's how to use it correctly and keep more of what you've built.
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Overlap Relief: Claim Tax Relief When Going Self-Employed
If you switched from employment to self-employment and your accounting period doesn't align neatly with the tax year, you may have paid tax on the same income twice. Overlap relief exists to fix this, and with the transition to the new tax year basis now complete, understanding how it works is essential. Here's exactly how to claim what you're owed.
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Abandonment Losses: Claiming Tax Relief on Failed Investments
When a company investment or subsidiary fails completely, HMRC allows a specific type of capital loss claim called an abandonment loss. Understanding how to claim this relief correctly can unlock significant tax savings for limited company directors. This guide explains who qualifies, what evidence you need, and how to make the claim.
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Claim Pre-Trading Costs Before You Launch Under Section 401 ITA 2007
Spent money before your business officially started trading? You may still be able to claim tax relief on those early costs. Section 401 ITA 2007 lets sole traders and freelancers treat pre-trading expenditure as a deductible expense on their first day of trading.
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Carried Forward Trading Losses: Maximise Your Relief Options
If your limited company has made a trading loss, you don't have to write it off. Carried forward losses can be offset against future profits to reduce your Corporation Tax bill, but there are rules you need to follow. Here's how to make the most of them.
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Timing Your Trading Cessation to Cut Tax on Your Final Year
Stopping your sole trader business at the right time can significantly reduce your final tax bill. This guide explains how to use overlap relief, manage your closing accounting period, and choose the smartest cessation date to keep more of your hard-earned money.
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Loss Relief for Sole Traders: Cut Your Tax Bill With Smart Planning
If your sole trader business makes a loss, HMRC gives you several ways to use that loss to reduce your tax bill. You can carry losses back, forward, or set them against other income in the same year. Understanding your options could mean a meaningful tax refund or lower payments on account.
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