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Hello sir,
is it absolutely necessary to set the terminal loss first against year of cessation trading profit before carrying back 36 months?
thankyouSir another related query. In opening year loss relief claim, is it necessary to set it against opening year profits before carrying it back against pre-trading income?
1. It is extremely unlikely that in a terminal loss situation that a trading profit assessment would actually arise in the final tax year BUT if such an assessment did arise then yes the terminal loss must be set off firstly against that trading profit before the 3 year carry back is pursued
2. The opening years loss relief carries the loss BACK against the total income of the preceding 3 tax years on a FIFO basis so it does go against the earlier years before the more recent years
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