Tax credits and self employed losses

jaydani

Hi, my Dh is self employed and last year i did my declaration as an estimate for his income 06/07 and I have to give an accurate figure by 31/1.

I estimated £0 income as he has losses from the previous year which will have offset his profit. The problem is that his accountant has now recommended he offsets his losses against previous years and get some some income tax back from when employed. Does this mean I have to say Dh made a profit this year? In which case we will have been overpaid by much more than we will get back from Income tax.

The accountant has said he 'doesn't think this will affect the tax credits' but Dh didn't check before confirming OK with accountant:eek: .

Any advice would be appreciated.

Conor_3

No, DH still made zero profit but what it does mean is that the negative amount will be offset against previous years income. The net result is still zero profit but the losses are split over previous years to lower their profit level, hence the income tax refund.