Sole Proprietorship, business loss, and personal taxes

[Osbi]

Good afternoon!

I was wondering if anyone here can advise: I am a yksityinen elinkeinonharjoittaja or sole proprietor, and my business expenses last year far outweighed by business income - so on my business tax form, I entered the loss (liiketappio).

Does this, in any way, carry over to my personal taxes? Since any gain would be taxable, is the loss tax deductible, and if so, how do I record this on my personal tax form?

Hoping for a better 2014!

[betelgeuse]

You have to make a claim. If there's no place for it in the forms then it's just a free form letter. It is possible from at least capital gains.

http://www.veronmaksajat.fi/Veroilmoitu ... oilmoitus/

If you don't make the claim, then you do have 10 years to use the loss for your business.

[betelgeuse]

I just looked at the form and it's there as box 373:
http://www.vero.fi/download/2013__Elink ... 286E}/6776

[tjawatts]

If you are a sole trader, then you business tax = personal tax. If you have paid taxes based on your profit projection then you can request it to be refunded (or wait until you have submitted all your tax forms and be refunded then). BTW you can adjust that tax during the year if you think your profit will be lower or higher than what you told the tax man at the beginning of the year.

If you have other sources of income other than your business, then as far as I know you cannot deduct the loses from your business against your other personal income. However, like someone already said you can carry forward those losses and deduct them from your company's future profit (so you pay less tax).

T

[betelgeuse]

If you are a sole trader, then you business tax = personal tax. If you have paid taxes based on your profit projection then you can request it to be refunded (or wait until you have submitted all your tax forms and be refunded then). BTW you can adjust that tax during the year if you think your profit will be lower or higher than what you told the tax man at the beginning of the year.

I am not aware of any process to be refunded prepaid paxes beyond the one that comes after taxation finishes (= all tax forms submitted). Can you link to some documentation about what you are referring to?

If you have other sources of income other than your business, then as far as I know you cannot deduct the loses from your business against your other personal income. However, like someone already said you can carry forward those losses and deduct them from your company's future profit (so you pay less tax).

You can (at least from capital gains). See the information I already provided. What I don't remember is whether leftovers capital gains carry over the regular income (like it does with interest deductions).

[tjawatts]

Cant say 100% for sole trader, but other forms of business if you submit an adjustment to the prepayment amount (i.e. set it to zero in the case of a loss) then vero to repay you any money you have already paid.

http://vero.fi/en-US/Precise_informatio ... 2820337%29

The Tax Administration will refund any excess prepayments to the taxpayer after approximately one week. It requires no request on the taxpayer's part. If the refund is made prior to the end date of the corporate taxpayer's tax-assessment process, no interest will be added to the refund amount

[betelgeuse]

The Tax Administration will refund any excess prepayments to the taxpayer after approximately one week. It requires no request on the taxpayer's part. If the refund is made prior to the end date of the corporate taxpayer's tax-assessment process, no interest will be added to the refund amount

I think this only refers to payments that are pending when you submit a request to change lower / waive. It will will not retroactive pay you back.

[tjawatts]

I have received refunds before. Not on personal taxation. But on the prepayments made for business income.

T

[betelgeuse]

I have received refunds before. Not on personal taxation. But on the prepayments made for business income.

Good to know then. Thanks.