Closing Ltd - Terminal Loss Relief

[VectraMan]

Can you not just do a "normal" loss carry back, ie to the previous year? Ie did you make a £10k+ taxable profit last year? If so, you should be able to offset the current year loss against that, without it using terminal loss relief.

WHS.

Not quite the same, but for a Plan B co. a few years ago I managed to get a refund for a bad debt. I.e. we paid CT at the end of one year on the basis of an outstanding invoice, then after a year had given up on it, declared the loss, and then got a CT refund. Only then did we close the company down having paid the remaining money out as a dividend.

[ctdctd]

Can you not just do a "normal" loss carry back, ie to the previous year?

Assuming you can get it so you're due a refund, the refund would be due to your company, not you personally. So firstly that means they'd be highly unlikely to physically pay it to you personally.

Taxable profit for last year only £1K so the three years carry back for Terminal Loss sounds better.

Would be a pain to have to keep company open just for a possible refund though.

Remaining retained profits will be withdrawn as a capital distribution as well under my personal CG tax allowance.

[Maslins]

Can you not just do a "normal" loss carry back, ie to the previous year? Ie did you make a £10k+ taxable profit last year? If so, you should be able to offset the current year loss against that, without it using terminal loss relief.

Assuming you can get it so you're due a refund, the refund would be due to your company, not you personally. So firstly that means they'd be highly unlikely to physically pay it to you personally. Secondly it means whilst it may be extra "free" money for your company, it's more money for you to take out at the end, so potentially personal tax consequences of that. Depends a bit whether dividend or perhaps you're getting CGT treatment on closing funds.

[ctdctd]

When an accountant comes on don't forget to ask if trying this might increase any chances of an investigation against the benefit of doing it

Closed company if they do - and are they going to bother coming after an individual for a few hundred squid?

Especially when the rules seem to suggest a claim is valid!

[northernladuk]

Good link NLUK - ta

"If not terminal loss may help, but there would have to be evidence that co was still trading in part of the final (current?) accounting period, eg still actively seeking contracts even if no work was done."

As I had some income from a short term contract and also evidence of being available and looking for contract work during the current period, it looks like it might be worth trying a claim.

When an accountant comes on don't forget to ask if trying this might increase any chances of an investigation against the benefit of doing it

[ctdctd]

What losses have you incurred?

http://forums.contractoruk.com/accou...y-pension.html

Good link NLUK - ta

"If not terminal loss may help, but there would have to be evidence that co was still trading in part of the final (current?) accounting period, eg still actively seeking contracts even if no work was done."

As I had some income from a short term contract and also evidence of being available and looking for contract work during the current period, it looks like it might be worth trying a claim.

[LondonManc]

There's the problem then. Ask *an* accountant.

[northernladuk]

Have you asked your accountant?*





* ©NLUK

I'm closing my Ltd next month - one man band contractor, no accountant, trading 10 years.

[LondonManc]

Have you asked your accountant?*





* ©NLUK

[northernladuk]

What losses have you incurred?

http://forums.contractoruk.com/accou...y-pension.html

[ctdctd]

I'm closing my Ltd next month - one man band contractor, no accountant, trading 10 years.

Current year - income minimal, salary paid out of retained profits so a loss for the year of about £10K
Previous 3 years paid small salary and then pension contributions so Corporation tax was only a few hundred PA.

Can I offset my losses for the current year against the Corporation tax already paid with this Terminal Loss Relief thingy?

Terminal Linky

Nice if I can, no biggy if not.

If I can, given that the company will be closed, will they refund it to me personally?

Ta for any advice!