Elect in Good Time

Events do not always turn out as expected. For example, you may need to wait for a later profit or loss to arise before you can judge whether it is right to elect to use losses in an earlier year. This is why the law allows you extra time, after you have submitted your tax return, to submit a tax election or claim. The elections you may need to make by 31 January 2024 for the 2021/2022 tax year include:

• setting trading losses against your other income (see our separate blog regarding pandemic losses)
• averaging the profits made from farming, or as an author or artist
• treating a property as continuing to qualify as a Furnished Holiday Let if it qualified as such in 2020/2021, but otherwise would not in 2021/2022

You need to wait for a certificate to arrive before making a claim for your investment under the venture capital schemes (EIS or Seed EIS), so the claim period for those schemes is five years after the tax return submission date.

Corporate tax claims generally need to be made within two years of the end of the accounting period in which the transaction occurred.

We can help you check what claims or elections you need to make.

The information in this blog provides only an overview of HMRC guidance and legislation in force at the date of publication and no action should be taken without consulting the detailed HMRC guidance and legislation or seeking professional advice.  Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this blog can be accepted by the firm.

Photo by Lukas Blazek on Unsplash