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Michael Paul Accountants

Company Losses

10th November 2014

Relieving limited company losses

If you run a limited company and you make a loss there are generally two options open to you

  1. Carry the loss forward  to set off against future profits
  2. Carry the loss back to set off against the previous year’s profit

Most company directors will opt for the second option as it means they will receive the benefit of the set off (i.e. the tax refund) sooner, particularly if they are unsure as to whether the company will make a profit in the next or subsequent years.

If carrying the loss back there needs to be sufficient profits in the previous year to make it worthwhile.  Your accountant will need to prepare and submit a revised Corporation Tax return for the year the loss is being carried back to so they may make a charge for the work involved.

If you have any questions regarding company losses or any other accounting or taxation matters then please don’t hesitate to contact us.

Michael Paul Accountants Northamptonshire is an independent ACCA registered accountancy practice.  We are located in the village of Lamport which is not far from the towns of Northampton, Kettering, Market Harborough and Corby.

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