To carry forward, you would be claiming a loss from the previous tax year as an expense in the current tax year. For example, if you made a loss of £10,000 on an investment, you could claim that as an expense against your profits in the following tax year. You can also carry forward some unused annual allowances, such as Pension Allowances.
The Pension Annual Allowance is the maximum amount that you can pay into your pension in a tax year. It’s based on your income but it’s up to £60,000 in the 2023/24 tax year. In order to be able to carry forward, you need to pay the maximum amount into your pension in a tax year. As soon as you’ve done this, you’re allowed to use up to three previous year’s worth of unused allowance to add more to your pension pot. However:
Also be aware that if you do this, it will need to be declared on a tax return and you won’t be eligible to claim the pension tax relief on your extra contributions.
For more detailed information about claiming a loss, visit the HMRC website or contact our experts to get started today
Of course we can! Get in touch with our experts today for comprehensive advice about Capital Gains Tax, Carrying Forward and everything in between.