A client of mine is self employed, but has not been working for the previous tax year so he can sort out his hectic lifestyle, and you might ask how is he providing a living and I believe he is using up some sort of inheritance.
The main question I am asking is...
He believes, owing to an accountant of 15 years ago providing him with a rebate from being in the same scenario as today, that he will get a rebate owing to his unused Personal Allowance of £9,440 for the tax year 2013/14.
I am unclear on this case, but from my take is that "How can he be entitled to a rebate if he has not worked for the previous tax year?", but what happens to his Personal Allowance?
Initially, I said that he wasn't entitled to any rebate, but after his previous case, I said maybe.
I have got until January 13st 2015 to do his online SA, but I am looking to complete his SA next week.
Please can someone give me some clarity as to this situation, and all answers are welcome.
From what you are saying, I am wondering if its possible that, in the year his former accountant got a rebate, the client had actually worked part of that tax year, and paid some tax? Then stopped working mid year - and was due back the tax he paid, because over the full year he hadn't used his full PA?
Or due to self employment loss carry back/forward maybe??
He can only get a refund if he has paid tax during the year...maybe if he has been living off his inheritance then he may have received taxed interest and you could certainly claim that back...but no tax paid, no refund and the personal allowance just gets wasted.
