How to reduce tax oved with loss on my buisness

shdjrs

Hi. I worked two jobs, hmrc somehow forgot to count first job and took not enough tax from second one. So in the end i have to pay about £800 tax, but a the same time i made about £1000 loss on my buisness. Is there any way to reduce that owed tax with loss? Hmrc still showing £800 to pay in my self assesment and dosn't want to reduce anything

Dazed_and_confused

When you completed your Self Assessment return what did you say you wanted to do with the loss?

shdjrs

I filled tax return, but not sent it yet, there was calculation about £800 owed, dosn't matter if i'm filling my buisness section or not. I want to reduce my tax i have to pay, because i made a loss on my self employment. Is it even possible?

Dazed_and_confused

Quite possibly.

The "Self" in Self Assessment refers to the fact that you (or your accountant) completes the return.

Have you looked at the options available when you have completed a self employment page and ended up with a loss?

MDMD

It’s called sideways loss relief.

https://www.litrg.org.uk/tax-guides/self-employment/working-out-profits-losses-and-capital-allowance/what-if-i-make-loss#toc-set-off-against-other-income-or-capital-gains-of-the-same-year

Note that there are some restrictions and you may lose your personal allowance (although on only £1000 loss it seems unlikely)

Pennywise

Upon what basis did your business loss occur? Did you prepare the accounts/return on the simplified cash basis or the standard accruals basis. If you've taken the simple cash option, then you can't have sideways loss relief and the loss is carried forward to set against a future profit from the same business. If you've done it on the accruals basis, then sideways loss is permitted and you'd just have to claim it on the tax return to set against other income of the same year. As said above, it's "self" assessment, so it's up to you to claim the loss (if allowable) against other income on "your" tax return.