I was just wondering if any of you has ever got a tax refund for a client ? To be more specific, if you take on a new client who has just started self employment and was also self employed (either at the same time or within the same financial year). If overall they made a SE loss, how do you go about getting a refund from the tax paid under PAYE from the employment? I should imagine that this is done whilst doing the self assessment tax return. Also if this is possible, how far back can you go in years to offset SE lossess ? I would really appreciate any examples from experience.
I handle a few CIS contractors so I regularly get refunds for them. It comes back to my account, I take my fee out and send them the balance. If they have been employed before becoming S/E then they will have a P45. Enter those figures onto the Employment supplement on the S/A return and any tax due back is calculated by your TR programme. Unless the client has died, you can't take any losses back to previous tax returns(without sparking an investigation) but you can carry the losses forward to offset against future years profits. Email me if I'm as clear as mud....lol
I also put the rest of my clients on monthly standing order, paid in advance, so that when we come to the year end, they have no big bills to pay(apart from tax, possibly). It makes my cash flow so much better and gives the client 12 months representation.
