What happens if your business makes a loss
A loss is when costs are more than income. See what it means for the year, how it can be carried forward and what it does to capital.
This path is practice in how the records and the sums work. It is not tax advice. Any rate or allowance in a question is an example for that question, so check GOV.UK for the current figures.
Task 1Profit or loss3 questions
Profit is business income less business expenses. When the expenses are bigger, the answer is a loss.
In his third year Dev was off work for three months after a fall, but his van, insurance and tools still had to be paid for.
| Item | Amount |
|---|---|
| Business income | 9,400.00 |
| Business expenses | 11,050.00 |
A loss is not paid out to you. It means the business made no profit that year to be taxed.
Task 2Using the loss later3 questions
You work out a figure and find the mistake in a table.
Task 3The loss in the books2 questions
You work out a figure and pick the right answer.