Question 4

A sole trader has the following tax adjusted results for the following 3 tax years. He continued in the same trade through-out:

2018/19 2019/20 2020/21

Trading Profits 152,000 0 141,000

Other income 112,000 115,000 117,000

The sole trader made a trading loss in 2019/20 of 143,000

What is the maximum amount of trading loss that could be set against the individuals income for 2020/21? At what level can it be offset? (Show all calculations and annotate fully)

(2 marks)

What is the maximum amount of loss that could be relieved in 2018/19 and what can it be relieved against? (Show all calculations and annotate fully) (2 marks)