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2 Businesses - Same Account - One in Loss/ One in Small profit

Joe58
Joe58 Posts: 5 Forumite
in Cutting tax
Hello

I am doing for the first time a self assessment.

I am sole trading and I am having a few activities:

- Online businesses: loss of over £18000
- Property letting agent: small profit of £8100 for £64792 turnover

Could you tell me how much roughly you think my tax calculation should be please ?

Overall there is a big loss, so I was expecting a very small amount of tax

By listing the two activities as distinct, does it make a difference in taxation ?

Thanks

Comments

  • HornyDevil
    HornyDevil Posts: 15 Forumite
    The losses on the one trade will be offset against the profit on the other, with the balance carried forward. There won't be any tax to pay.
    The best signature is a nonexistent signature, leaving more space for intellectual and considerate topic discussion ;)
  • TM1976
    TM1976 Posts: 717 Forumite
    You can't set the online business loss off against the lettings income, but you can carry it forward against future profits.

    Presuming this is your only income you can make £6,475 tax free to the rest is taxed at 20%, perhaps about £400 of tax + NI.

    You have to declare these separately as lettings income is different to income from a trade.
  • Joe58
    Joe58 Posts: 5 Forumite
    Thx for ur prompt reply.

    So, would you guess what I do wrong please ?

    In "view calculation", I've got
    "Total tax, Class 4 NIC and Student loan due for 2008-09: £649"
  • Rolo_Tomasi
    Rolo_Tomasi Posts: 343 Forumite
    TM1976 wrote: »
    You can't set the online business loss off against the lettings income, but you can carry it forward against future profits.

    This is correct but my understanding of your post is that you are a lettings agent ie you charge a fee for managing other peoples properties. If this is correct then you can offset the loss of one trade against the profit of another however you will have to complete two separate self employment pages on your self assessment return.

    When you allocate the loss on one trade against the profit of another, there is another box to complete to ensure that you do not pay any class 4 national insurance - from memory I think it is on the last page of the self employment pages.
  • TM1976
    TM1976 Posts: 717 Forumite
    You have to pay 8% national insurance above the lower earnings limit of £5,435.

    Tax £325 + NI £213 = £538, I guess the balance is your student loan payment.
  • Joe58
    Joe58 Posts: 5 Forumite
    TM1976 wrote: »
    You have to pay 8% national insurance above the lower earnings limit of £5,435.

    Tax £325 + NI £213 = £538, I guess the balance is your student loan payment.

    Thx for ur messages.

    I 've never contracted any student loan in England.

    I called HMRC yesterday and I told them that, but they said to still submit my return and then call them again. I don't want to fork out £600 to then fight bureaucracy to claim it back. So, I prefer to do it right before submitting anything.

    Thanks for all your replies. This forum should receive subsidies from HMRC !

    Rolo Tomasi, you said that it is on the last page.
    I am doing this online. Where is that please ?


    Tell us about you


    * Success Change details about you

    Tailor your return


    * Success Change your tailored return (page 1)
    * Success Change your tailored return (page 2)
    * Success Change your tailored return (page 3)

    Self-employment
    BUSINESS ONE (Letting agent)

    * Success Change self-employment details (page 1)
    * Success Change self-employment details (page 2)
    * Success Change accounting details
    * Success Change income
    * Success Change expenses
    * Success Change capital allowances
    * Success Change adjustments
    * Success Change losses
    * Success Change tax deducted
    * Success Change class 4 NIC
    * Success Change additional information
    * View summary

    BUSINESS TWO (Online)

    * Success Change self-employment details (page 1)
    * Success Change self-employment details (page 2)
    * Success Change accounting details
    * Success Change income
    * Success Change expenses (page 1)
    * Success Change expenses (page 2)
    * Success Change capital allowances
    * Success Change adjustments (page 1)
    * Success Change adjustments (page 2)
    * Success Change losses
    * Success Change tax deducted
    * Success Change class 4 NIC
    * Success Change additional information
    * View summary

    Foreign


    * Success Change details (Page 1 of 2)
    * Success Change details (Page 2 of 2)

    Foreign income types

    * Success Change other foreign income and gains

    Underpaid tax


    * Success Change underpaid tax (page 1)
    * Success Change underpaid tax (page 2)

    Overpaid tax


    * Success Change overpaid tax
    * Success Change repayment to yourself

    Not paid enough tax


    * Success Change not paid enough tax

    Adjustments to tax due


    * Success Change adjustments to tax due

    Any other information


    * Success Change any other information (page 1)
    * Success Change any other information (page 2)
  • Rolo_Tomasi
    Rolo_Tomasi Posts: 343 Forumite
    On the losses page of business 2 (online business) you should included the total taxable profit from business 1 (£8100) in box 77 - loss from this year to offset against other income. The balance of the loss should be put into box 79 - loss to carry forward.

    On the Class 4 NIC page of business one you should put the loss used from the online business (£8100) into box 101 - adjustment to profits chargeable to class 4 nic. I think this has to be a negative figure.
  • Joe58
    Joe58 Posts: 5 Forumite
    Thx everybody for your very appreciated help.

    Return has now been submitted.

    Thx.
This discussion has been closed.
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