Hi @Richard.W , I;m going this wayā¦this is my year end summary based on the XLS Iāve built with your help a long time ago,
So Iāve filled the sections below like this and have used āLosses available to be carried forwardā with my lossesā¦ do we think is the correct way to do it ?
I think the losses you have to carry forward is 3762 - 1828 = 1934, not 3762. You have already used 1828 of your losses against the gains in this tax year. The rule is that losses must be used as far as possible against gains in the same year that the losses took place. You will only carry forward any losses that are in excess of your gains.
I used to misunderstand this and think you could postpone taking losses when gains were already under the CG tax free limit. But a correspondence with HMRC cleared this up in my mind.
Thanks @Richard.W makes sense.
Question about that Carry Forward Losses field: say for example next year 23/24 I post these resultsā¦ say 6k gain 1k loss.
Can I carry forward to 24/25 these 1934 from this year and not use them ? Will I just write 1934 in the same field(tax return 23/24) or leave it empty because I stated them already in the tax return of 22/23 ?
In simpler words, is that field cumulative ? as in I have to sum all previous years carry forward losses and always state them in the last tax return ?
Unfortunately, I think not. As I understand, you must apply any prior years unused losses to your gains at the first opportunity, even if this means you will lose some benefit from the CG tax free allowance that you might otherwise have enjoyed. And any losses not so used within four years become unavailable.
You might check this by askıng at the HMRC customers on Facebook messenger or on X.
I did misunderstand this myself. I had thought some gaming of when to declare losses might be possible, as you are thinking. But I learned that was not the case after and Q&A with a HMRC agent. Seems it was too good to be true.
I believe that once registered, losses can be carried forward indefinitely there is no time limit.
The four year rule is that losses have to be reported to HRMC within 4 years in order to be carried forward
Edit: but as already said by others, in any tax year any loss has to be first applied against any gains even if the gains are below the cgt threshold. So you canāt have a gain of Ā£x and a loss of Ā£x and selectively just carry forward the loss
@WakeMeUp Thank you for that correction on the four year carry forward. But suppose you report a loss two years after it occurred, and if you had reported it earlier then it could have been used up against gains two years ago (gains which had escaped tax because of the CG tax free allowance). What then? Do you have to amend the tax return of two years ago?
If you are doing tax returns then I assume you will include/report losses in the year they occur and in that year they have to be first used against any gain even if the gain is less than the cgt threshold. Thus if you are doing tax returns you will not be reporting a loss a couple of years later.
There are, however, many people who arenāt required to do annual tax returns. Those people will have to report any losses that they wish to carry forward within the 4 years. Again they have to comply with the other rules (ie using the losses in the year that the loss occurred to offset any gainsā¦)
To sum it up: 4k loss, 2k gain I can carry forward 2k. But next year I must use those 2k against my gains(if any), and if still I have losses I can sum the losses of the last + current year in the carry forward losses field.
Correct ?
CARRY FORWARD LOSSES = GAIN - LOSS - CARRY FORWARD LOSSES FROM LAST YEAR.
and if I use these 1935 next year I have to put them in field 45, correct ?
I think you should get professional advice especially if youāre unsure.
I could be wrong (i havenāt need to register losses) but I though 1) if you make a loss in a particular tax year you have to first offset that against any gains in the same year but 2) if you do then register a loss you can elect when to use that loss in the future. Thus I am not sure whether you have to use the loss in the next tax year or whether that decision is optional.
Hi @Richard.W,
Itās this time of the year againā¦
Last year I declared 2K gains and 4K losses. So Iāve stuck 2K as losses to carry forward(SA 22/23)
This SA(23/24) I have a small gain (Ā£900), no losses. Can I declare Ā£900 and carry forward the Ā£2000 from 22/23 ? Or do I need to subtract those Ā£900 from them ?
(As SA 24/25 Iāll hopefully have more than 3K gains which will need to pay CGT, so would love to use what losses I can to offset that)
I think you are required to set your carried forward losses against those Ā£900 gains, even if those gains would have been covered by your tax free allowance. So now you will have less carry forward losses to use in the subsequent year.
Hi all,
Unfortunately I have a very dark secret. I made huge losses trading cfds 2 years ago. I am now finally coming to terms with what happened and looking to offset these losses. I have downloaded from trading 212 annual statements for 2022 and 2023.
Just to give you a scope of my issue the 2022 document is 124 pages long.
Anyway I was hoping if someone could help me get started. I have never even done a self assessment before.
So from my understanding, first i need to register for self assessment?
Then how do I complete a self assessment for an old tax year? Do i have to log each trade?
Oh my. I am having serious anxiety of all the steps involved.
If anyone can help with the basics that would help. Then I guess I will just take it a step by step to complete.
Also 212 provides pdf. Is there a spreadsheet version of statements? Will this help?
is there an excerpt from an HMRC manual about this ? @Richard.W
I suggest reading here
https://community.hmrc.gov.uk/customerforums/cgt/7ea109cd-c5e2-ed11-913a-00155d978126
There are replies to questions from HMRC agents.
After reading the article you posted I definely understand you need to use in-year losses before anything else, but it my example I should be able to declare Ā£900 as CGT and carry forward the Ā£2000 losses from previsous years. As I donāt have in-year losses to use against those Ā£900.
To summarise:
Did I understand it correctly ? @Richard.W
Unfortunately, your idea in the third bullet point is beyond what I have understood from having read HMRC publications. You could try to contacting HMRC to ask.
I do not believe that you can partially use losses as you suggest in your third bullet point. You canāt use just enough to get you under the cgt threshold. I may be wrong
If someone can post the snippet from an HMRC manual about this ā¦ as the Admin said itās fine on the forum.
