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Question 5a i
Spike requires advice on the loss relief available following the cessation of his business
Spike:
– Ceased to trade and sold his unincorporated business to an unrelated individual on 30 September 2012.
Spike’s unincorporated business:
– There are overlap profits from the commencement of the business of £8,300.
– The sale of the business resulted in net capital gains of £78,000.
– The tax adjusted profits/(loss) of the business have been:
| £ | ||
|---|---|---|
| Year ended 31 December 2008 | Profit | 52,500 |
| Year ended 31 December 2009 | Profit | 68,000 |
| Year ended 31 December 2010 | Profit | 54,000 |
| Year ended 31 December 2011 | Profit | 22,500 |
| Nine months ending 30 September 2012 | Loss | (13,500) |
Required:
(a) (i) Calculate the trading loss for the tax year 2012/13, and the terminal loss, on the cessation of Spike’s unincorporated business; (4 marks)