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Post Info TOPIC: Capital Allowances
Silly Digits


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Capital Allowances
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Hi all

I have a client that has made a vary small profit £200.  My question is usaually I would claim 20% capital allowance £700.  But this will end up with a loss.  Do I have to claim capital allowances this year?

I know you can put losses against previous years and future years, any advise would be appreciated.



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RobH


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No you do not need to claim all or any capital allowances. Next year you can cannot claim double but you do not need to waste them.

Rob

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Rob
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adi2402


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I would have though it would have been beneficial to claim the allowances this year and carry forward the loss or use it this year against other income. Hard to advise with no other details etc but generally i would be claiming them.



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Forgive the typo's I generally do not proof read. Just lazy I guess!
Silly Digits


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adi2402

There is no other income for this year.

They made a profit last year.



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adi2402


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Hi,

If last years profits generated a tax liability then you could create the loss this year by claiming capital allowances and carry them back to 08/09.  This will generate a small refund. 

There is a section on the self employed pages which allows you to show the loss carried back.  You then calculate the refund and detail it on the tax return. 

In box 78 Page SEF4, if a sole trade to show the loss carried back.



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Forgive the typo's I generally do not proof read. Just lazy I guess!
Davey


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I would work along the line of what Rob Advises. Not to claim Capital Allowances
as it would be wasting the allowance. Is this person a sole trader . Is the £ 200
adjusted profits for tax purposes. The Single Persons allowance of 6475 would
more than cover the profits. So no tax payable anyway. So claim next year
but not double. what were the profits in 08/09 were the adjusted profits
above the single persons allowance.



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David
Silly Digits


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The taxable income for 2008/9 after personal allowance was £493.00.

The client is a sole trader.

So you advise not to claim any capital allowances this year but next year claim what I would of normally claimed this year if showing a profit over the personal allowance.





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adi2402


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Sorry when i advised before i assumed your client was employed as well due to the low level of profits. I should have asked I assumed his PA was fully used.

The above advice is better than mine :)

-- Edited by adi2402 on Monday 3rd of May 2010 05:57:20 PM

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Forgive the typo's I generally do not proof read. Just lazy I guess!
Davey


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Your advise was also good.

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David
Silly Digits


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Thank you all for your help

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