TXF6 UK

Section C: Q3ii

sample exam

Q3ii Section C

On 6 August 2017, Danh commenced self-employment as a sole trader. In addition, on 6 September 2017, Danh joined an existing partnership run by Ebele and Fai. The following information is available for the tax year 2017-18:

Partnership loss
(1) For the year ended 5 April 2018, the partnership made a tax-adjusted trading loss of £12,600. Until 5 September 2017, profits and losses were shared 60% to Ebele and 40% to Fai. Since 6 September 2017, profits and losses have been shared 20% to Danh, 50% to Ebele and 30% to Fai.

(2) Danh will claim to relieve his share of the partnership’s loss against his total income for the tax year 2017-18.

(3) During the tax year 2017-18, Danh paid interest of £875 (gross) on a personal loan taken out to purchase his share in the partnership.

Required:

What is Danh’s share of the partnership loss for 2017-18?