Taxation of the unincorporated business for Paper P6 (UK) - part 1: self-test answers

Test your understanding: answers

(1).  (i) Cease trading on 28 February 2015

2013/14Year ended 30 June 2013
2014/151 July 2013 – 28 February 2015 (the end of the basis period for the penultimate tax year until the date of cessation)


(ii)
Cease trading on 31 May 2015

2014/15Year ended 30 June 2014
2015/161 July 2014 – 31 May 2015 (the end of the basis period for the penultimate tax year until the date of cessation)


(2). The trading loss of the final tax year can be offset against the general income and chargeable gains of the final tax year and/or the previous tax year.

The loss of the final 12 months of trading, known as the terminal loss, can be offset against the trading profits (note, not general income) of the final tax year of trading and the three preceding tax years, later years first.