How to report a small loss on approved sip

busybee100

Hi.

Tax and NI have been paid through the PAYE system but there was a small loss on the sale of the shares and a small dividend payment before they were sold. Less than £100 in total.

Should the total go under other income?

bowlhead99

The dividend just goes in the dividends section.

If you want to claim the small capital loss (the difference between your purchase price and sale proceeds) you can do that in the part of the tax return that deals with capital gains and disposing of things at a gain or loss. You only have to fill that bit out if the total disposal proceeds for the year were over 4 times the annual capital gains exemption of £11k (i.e. for example if your SIP involved selling shares for £49,900 which had been purchased for £50k). Otherwise it is optional.

So if you did not get rid of shares worth over £44k you don't have to bother with the capital gains and losses section, but if you have a capital loss of £100 you might want to carry it forwards to use the next time you have a capital gain in excess of your annual capital gains exemption in some future tax year - in which case you need to declare it. If you can't be bothered, you don't.

But what you can't do is take, say, £160 dividend income and a £100 capital loss and say that's just a net figure of £60 to chuck into miscellaneous other income. The two things have different tax rates.