Some activities are taxed as income, and we will look into the specific situations in the following section. Income taxes possibly apply to :
- Financial trading
HMRC mandates that trading losses be reported in your Self Assessment tax return. You can understand how these losses are reported through the HMRC's helpsheets: HS227 Self Assessment helpsheet and HS325: Other Taxable Income.
Traders can reduce income tax liability through an offset of their losses against other incomes or future profits. Meanwhile, losses can also be carried forward to later years if your trading activities have profits declared as miscellaneous income.