Uk Tax Year
November 9th, 2002
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Uk Tax Year
Question: UK Tax Return. Can I claim expenses that were spent in a previous tax year, but haven’t been claimed before ?
I have a bunch of receipts which were for business expenses in Tax Year 06-07, but I did not claim them then as I had very low earnings in that year. Now I owe a considerable amount of Tax, can I claim them this year, or is it strictly expenses spent in the year 2007-2008 ?
Answer: I’m not sure I understand either of the previous 2 answers.
Expenses should be applied in the accounting year in which they were incurred. What you should have done was calculate your profit for year 06-07 taking into account all expenses. It sounds like you actually made a net loss in that year.
Depending on your circumstances there are a number of ways you can use that loss to offset against other tax liabilities. One way would be to carry it forward and offset it against future profits of the same trade – ie the profits you are expecting in 2007-08.
I’m sure you can adjust your return for 06-07 but I’m not sure of the exact procedure. I would suggest asking your local tax office.
It may be that even with these expenses you would still have made a small profit in 06-07. EG if your 06-07 profits were £2000 then you would have had no tax to pay after using your personal allowance. If the expenses were £1000 then you would still have been in profit, but there would be no difference to your tax bill.
In these circumstance you do not have a loss to carry forward, so there is nothing you can offset against your tax bill for 07-08.
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