Chapter 6 Trade income Flashcards
1
Q
Opening year losses are offset against:
A
The loss is off set against the GENERAL INCOME from the 3 prior years
FIFO basis
2
Q
When can pre trading profits be allowed in adjusting profits
A
If they are not incurred more than 7 years before trading commences
3
Q
How are pre-trading expenses treated
A
As if they were purchased on day 1 of trading
4
Q
Change of accounting period leading to long accounts …
A
Lead to overlap profits being used up
5
Q
Change in account periods leading to short (less than 12 months) should be taxed how
A
Tax the 12 months to the period end date. Leading to creations of over lap profits
