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Q: Can tax be reclaimed from previous years if I have made a loss this year? And if I make a small profit, can I also use my tax-free pay to claim back tax from previous years?

Jun 08 2009

Answered by: Marc Barber Ask a question

I assume from the second part of the question that you are trading as a sole trader or in partnership and that you are an active partner in the business. If this is the case, then losses made in one year can be carried back to the previous year, so that tax refunds can be obtained (assuming that tax was paid, of course!). It is not, however, possible to carry back personal allowances (the so-called tax free pay). If these are not used in a tax year then regrettably they are lost.

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