The following taxpayers are self-employed and have been trading for many years. None of them has yet
Question:
The following taxpayers are self-employed and have been trading for many years. None of them has yet ceased trading:
(a) Taxpayer W has adjusted trading profits of £38,200 for the year to 30 November 2023 and £43,680 for the year to 30 November 2024. Overlap profits arising on the commencement of trade were £2,860.
(b) Taxpayer X has an adjusted trading loss of £9,420 for the year to 31 August 2023 and an adjusted trading profit of £56,160 for the year to 31 August 2024. Overlap profits arising on the commencement of trade were £5,240.
(c) Taxpayer Y has adjusted trading losses of £21,400 for the year to 31 January 2024 and £15,360 for the year to 31 January 2025. Overlap profits arising on the commencement of trade were £4,950.
(d) Taxpayer Z has adjusted trading profits of £18,620 for the year to 31 December 2023 and £8,160 for the year to 31 December 2024. Overlap profits arising on the commencement of trade were £7,130.
In each case, calculate the taxable profit (or loss) for tax year 2023-24. Assume that none of the overlap profits arising on commencement have yet been relieved.
Step by Step Answer:
a The transition part profit is 412 43680 14560 overlap 2860 11700 So the taxable profit for 20232...View the full answer
