Tax Return Question now back on PAYE

scrub

I didn't work between March and September of last year. I got a job via an umbrella company, paying PAYE October to February and a short term contract paying PAYE March onwards. I made a loss from expenses of £3k.

On the 'Losses' page, it says

• Loss from this tax year set-off against other income for 2013-14:
• Loss to be carried back to previous year(s) and set-off against income (or capital gains):
• Total loss to carry forward after all other set-offs including unused losses brought forward:

I'd like it to come off the outstanding money I owe for 2012 - 2013 due at the end of this month. Do I just put the £3k in the second option?

purdyoaten

Were you self-employed?

The amount payable in July is a payment on account for 2013/14, nothing to do with 2012/13!

scrub

I was self employed from Feb 2011 to Sept 2013 and then went back to PAYE.

As I made a loss when I was self employed, the form is asking in the questions I raised above what I want to do with the losses so should I just select the third option? I just want to settle all the tax asap and not drag it out.

purdyoaten

I am more than a little confused as you state in your first post that you didn't work between March and September of last year but you now say that you were self-employed until September 2013.

Losses are complicated and you need to be exact.

You need to quantify the loss for each tax year. not generally but because you had a short period of self-employment. The loss for 2013/14, for example, would be the loss for the period 6th April 2013 to September 2013.

Now if you made a loss in that period, you should have no tax to pay for 2013/14. The first payment was due in January 2014 with the second one at the end of this month. Is this what you mean? If so, apply to reduce the payments (both of them, including the January one already paid) to Nil using this form :

http://www.hmrc.gov.uk/sa/forms/sa303.pdf

Come back when you are able to clarify the loss position.

scrub

purdyoaten wrote: »

I am more than a little confused as you state in your first post that you didn't work between March and September of last year but you now say that you were self-employed until September 2013.

Losses are complicated and you need to be exact.

You need to quantify the loss for each tax year. not generally but because you had a short period of self-employment. The loss for 2013/14, for example, would be the loss for the period 6th April 2013 to September 2013.

Now if you made a loss in that period, you should have no tax to pay for 2013/14. The first payment was due in January 2014 with the second one at the end of this month. Is this what you mean? If so, apply to reduce the payments (both of them, including the January one already paid) to Nil using this form :

http://www.hmrc.gov.uk/sa/forms/sa303.pdf

Come back when you are able to clarify the loss position.

I was self-employed contractor whose job ended at the beginning of March and I couldn't get a replacement job until October which was PAYE but I incurred costs looking for one. The £3k is rounded up for here. I know the exact amount and how it breaks down.

Wouldn't just doing the tax form now be enough. When I did the January return, it pretty much immediately reduced how much I owed.

purdyoaten

It would. However, I would repeat - if you made a loss in 2013/14, quantified as per my previous post, you should not be making payments on account for 2013/14 in January 2014 or July 2014.

The loss - if £3000.

You can set it against other income in 2013/14 - presumably your PAYE income = the first option but this is only worthwhile if you earned more than £9400 in your PAYE job from October to March 2014 - £12400 would be ideal.

You can set it back against the previous year - 2012/13 - did you pay at least £600 tax in that year?

You can carry forward against future trading profits - no good as you have ceased.

scrub

purdyoaten wrote: »

It would. However, I would repeat - if you made a loss in 2013/14, quantified as per my previous post, you should not be making payments on account for 2013/14 in January 2014 or July 2014.

The loss - if £3000.

You can set it against other income in 2013/14 - presumably your PAYE income = the first option but this is only worthwhile if you earned more than £9400 in your PAYE job from October to March 2014 - £12400 would be ideal.

You can set it back against the previous year - 2012/13 - did you pay at least £600 tax in that year?

You can carry forward against future trading profits - no good as you have ceased.

Yes, I earned over £12.5k for Oct - March.

purdyoaten

scrub wrote: »

Yes, I earned over £12.5k for Oct - March.

No problem then. Choose the first option and file the return. You should be in a refund situation, particularly if you made a payment on account for 2013/14 in January. The size of the refund will depend on the tax deducted at your PAYE but the calculation will tell you that.

scrub

purdyoaten wrote: »

No problem then. Choose the first option and file the return. You should be in a refund situation, particularly if you made a payment on account for 2013/14 in January. The size of the refund will depend on the tax deducted at your PAYE but the calculation will tell you that.

Great! I'll put the £3000 in the first option!

Many thanks for this help!

scrub

purdyoaten wrote: »

No problem then. Choose the first option and file the return. You should be in a refund situation, particularly if you made a payment on account for 2013/14 in January. The size of the refund will depend on the tax deducted at your PAYE but the calculation will tell you that.

I'm getting an error message if I use the first field:

The amount entered for 'Loss from this tax year set-off against other income for 2013-14' as you have answered 'Yes' to 'Did you use the cash basis, money actually received and paid out, to calculate your income and expense?'. Please amend.