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Xiao Ltd has the following results for the two accounting periods to 31 March 2017:
9 months to Year to
31 March 2016 31 March 2017
£ £
Trading profit/(loss) 21,900 (24,800)
Chargeable gains 3,500 6,600Assuming that Xiao Ltd makes all possible claims to relieve the trading loss against total
profits, what is the total taxable profit for the nine months to 31 March 2016?A Nil
B £7,200
C £11,750
D £21,900“B” is the answer, how do I get to it?
Thankyou!
The loss of 24800 is relived against that years chargeable gain of 6600,thus leaving 18200 unrelieved loss which is carried back against profit of 21900.
After carry back remaining profit of 3700 along with the chargeable gain of 3500 adds to 7200 -the answer.one important change to your answer sn08 – after the current period claim of 6600 leaving 18,200, the carry back claim is against total profits NOT trading profits so the 18,200 is set against total profits of 25,400 (21900 + 3500) leaving 7200
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