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

Test your understanding: answers

(1).  (i) Year end of 31 December

2021/221 June 2021 – 5 April 2022
2022/231 January 2022 – 31 December 2022 (accounts for the 12-month period ending in the tax year)
2023/241 January 2023 – 31 December 2023 (accounts for the 12-month period ending in the tax year)

The overlap period is from 1 January 2022 to 5 April 2022 (three months).


(ii)
Year end of 30 April

2021/221 June 2021 – 5 April 2022
2022/231 June 2021 – 31 May 2022 (first 12 months)
2023/241 May 2022 – 30 April 2023 (accounts for the 12-month period ending in the tax year)

The overlap period is from 1 June 2021 to 5 April 2022 and 1 May 2022 to 31 May 2022 (a total of 11 months).

(2). The loss can be offset against general income of 2020/21 (the year of the loss) and/or 2019/20 (the previous year).

Where a claim has been made against general income, a further claim can be made against the chargeable gains of 2020/21 and/or 2019/20.

The loss can be offset against general income of 2017/18, 2018/19 and 2019/20 (the three years prior to the year of the loss on a first in, first out basis).

Any loss remaining will be automatically carried forward against future profits of the same trade.