Doing my tax return online and the question relates to the 'Other UK income' section. Last year I made profit from lending on crowd funding and copy-trading, and I entered the figures in the "Other taxable income (before tax and expenses taken off)" field.
This year, I made loss, and when I enter a negative number and click 'Next', it returns an error: "The amount entered for 'Other taxable income...' must be greater than 0 (zero) or blank. Please amend."
I'm assuming that I can set aside losses from 'Other UK income' against my employment income? I can't enter a negative number and I don't see a field .
I was told the copy-trading income from eToro falls goes under income tax: http://www.justanswer.com/finance/7zsvd-tax-return-i-work-full-time-income.html
I suppose interest earned from lending on Funding Circle should be reported as interest as you mentioned, it seemed similar to eToro so this was error in my assumption. The statement has Total interest earned, with deduction of servicing fee, resulting in Net payments. Do I use the figure with or without servicing fee?
I don't know what EIS or SEIS project mean - I don't think the ones on Funding Circle are, as otherwise I assume I'd have come across these terms.
Please clarify what you mean by "you will not to rectify the earlier year tax returns". Do I need to rectify or do I not need to? And if I need to, how would I do so?
And if the income from eToro goes under Additional income, and I can't enter losses, I assume I can still enter the expenses of gas/elec as £3 and proportion of internet usage, with income as 0. That would result a minor overall loss if that's correct? If I carry losses to future years, how many years can I carry them?
Also, I was searching around and on Funding circle site I found a reference to "Losses on loans to traders" section at https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/323727/hs296.pdf - so irrecoverable losses can be considered.
Thanks information, Sam.
I'm still confused about eToro.
Last year, I assigned proportions of my account to copy certain traders - which I monitored and changed as needed. But I also placed some trades myself - so the statement includes sum of both activities.
Another eToro trader suggests that they only report on the tax return when they withdraw funds into their bank account, https://openbook.etoro.com/posts/0__entry__677b66d3-919d-4b80-8359-8e77de7c4ab5. I remember searching last year and had found another similar article, and people suggested they reported as trading income.
And another person claims "this is all tax free income in UK so what you actually earn on eToro is 100% yours to keep, no taxes to pay!".. http://andrewminalto.com/easy-money/ .. and yet another trader at a conference suggested it's trading .. so I keep finding endless different answers on this and I don't know what the right approach is, or if there is one!
Thanks clarification, Sam. I understand that losses cannot be claimed, I'm just trying to figure out how to fill in the return correctly, ie which bit goes in which section of the tax return.
Sorry I may not have phrased the question clearly or may not have used the right terms. I'm still unclear on your answer, to decide which section of the tax return I should enter the information in.
I understand that lent to selected businesses via Funding Circle crowdfunding, the income should be declared as interest
Income from crowdfunding
lent to businesses I chose via Funding Circle crowdfunding, I thought this should be declared as interest, as per your first response.. 'Therefore you should be treating this as interest made (rather than profits)'. But I read your last response as this is income tax 'crowdfunding or peer to peer lending this IS income that must be declared on which tax is due (income tax)'. And that from April 2015 peer to peer can be offset against peer to peer lending profits.
Income from eToro
I understand that this year as I've made a loss, I don't need to put anything in the tax return. year, my activity included a mixture of forex, commodities and stocks/shares, eToro provides a single statement. And a mixture of copy-trading and trades I placed on my own. I understand cases (eg forex on its own is not taxed), but it's unclear to me what to do where to place things on the tax return when this encompasses a mixture of things?
Correcting earlier tax returns
Regarding my question about how to rectify previous tax returns, searching online, I found there's usually a 12 months deadline (https://www.gov.uk/self-assessment-tax-returns/corrections). How do I correct the tax returns prior to last year be corrected?
Many thanks Sam.