PAYE minus sole trader loss, tax credits

chris_h16

Hi

I work full time paying tax through PAYE. I'm also self employed, and started a new business, and with investing in the business have made a loss this year. I believe that can come off my main employment tax allowance so I will be due tax back, but my main question is, what figure do I put on the tax credits form? Can I put my main income minus the loss of my self employment on the tax credits form? I think the form says if you made a loss in self employment to just put £0 but if I'm allowed to claim the tax back from making a loss, surely we can put less income on the tax credits form.
Example £30,000 in main employment
loss of £2000 in self employment
I get taxed on £28,000
As I've paid tax already through PAYE on £30,000 I'm due tax back on £2000. Do I put £28,000 or £30,000 on my tax credits form?

Darksparkle

Your tax credit form has nothing to do with the tax you've paid. It's to check you were paid the correct working/child tax credits.

Are you talking about your self assessment?

Icequeen99

chris_h16 wrote: »

Hi

I work full time paying tax through PAYE. I'm also self employed, and started a new business, and with investing in the business have made a loss this year. I believe that can come off my main employment tax allowance so I will be due tax back, but my main question is, what figure do I put on the tax credits form? Can I put my main income minus the loss of my self employment on the tax credits form? I think the form says if you made a loss in self employment to just put £0 but if I'm allowed to claim the tax back from making a loss, surely we can put less income on the tax credits form.
Example £30,000 in main employment
loss of £2000 in self employment
I get taxed on £28,000
As I've paid tax already through PAYE on £30,000 I'm due tax back on £2000. Do I put £28,000 or £30,000 on my tax credits form?

Yes, you can also deduct the loss from your income for tax credits.

Have a look at form TC825 which explains the steps.

In your example, you would put Nil for self-employment income and then deduct the £2,000 loss from your 30k - so yes you would put 28k as your earnings. HMRC may challenge this of course.

IQ

densol_2

I would also do your self assessment for the year as well, so the figures on HMRC system ' match '

chris_h16

Darksparkle, tax credits require income figures.
Thank you icequeen99 and densol, answered my question perfectly.