188体育

Paragraph 2(4) Schedule 1B sets out how the claim is to be quantified. It reads

(4) Subject to sub-paragraph (5) below, the claim shall be for an amount equal to the difference between-

(a) the amount in which the person is chargeable to tax for the earlier year (鈥渁mount A鈥�); and

(b) the amount in which he would be so chargeable on the assumption that effect could be, and were, given to the claim in relation to that year (鈥渁mount B鈥�).

The claim is quantified in terms of the tax difference in 鈥渢he earlier year鈥�. The 鈥渢ax difference鈥� is the tax that would not have been due in 鈥渢he earlier year鈥� if the claim could be and had been given effect to in that 鈥渆arlier year鈥�.

Example 1

Casey declared profits of 拢25,000 in her self-assessment return for 2018-19. Casey is now completing her tax return for 2019-20 and has made a loss of 拢10,000. Casey wishes to carry this back to 2018-19.

Casey鈥檚 claim is quantified as follows:

2018-19 original tax calculation (鈥渁mount A鈥�)

Profits 拢25,000

Less Personal Allowance (拢12,500)

拢12,500

Tax at 20% 拢2,500

2018-19 tax calculation after effect is given to the claim (鈥渁mount B鈥�)

Profits 拢25,000

Less Personal Allowance (拢12,500)

Less Loss from 2019-20 (拢10,000)

拢2,500

Tax at 20% 拢500

Casey鈥檚 claim is calculated as the difference between 鈥渁mount A鈥� (拢2,500) and 鈥渁mount B鈥� (拢500).

Casey鈥檚 claim is, therefore, 拢2,000.

The claim is only quantified by reference to the earlier year. It remains a claim for the later year as that is the year in which the event giving rise to the claim occurred. For example, the year in which the loss arose.