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Start your own Business Relief

  1. Overview
  2. Who qualifies for this relief?
  3. Are there any restrictions for your business?
  4. How do you apply for the relief?
  5. How do you calculate the relief?
  6. What happens if you make a loss in the first year?

What happens if you make a loss in the first year?

Ordinarily if you make a loss in a year, you must use that loss against the profits in the next year. Relief under the Start Your Own Business Relief is used before you claim relief for losses forward. Therefore, where you make a loss in year 1, you must claim Start Your Own Business Relief in year 2 before you claim relief for any losses you made in the first year. This ensures that if you make a loss, you will receive the actual value for those losses in future years.

  • Example 1

    Susan qualifies for Start Your Own Business Relief. She started her business on 1 January 2014 and made up her accounts to 31 December each year. In 2014 she made a loss of €10,000 while in 2015 she made a profit of €15,000.

    Susan claims Start Your Own Business Relief against the €15,000 profits in 2015. She can carry the loss of €10,000 forward to offset against her profits in 2016.

Capital allowances

You must use Start Your Own Business Relief before claiming capital allowances. You can carry unused amounts of capital allowances forward for use in future years.

  • Example 2

    Sam qualifies for Start Your Own Business Relief. She started her business on 1 January 2014 and made up her accounts to 31 December each year. In 2014 she made a profit of €3,000 while in 2015 she made a profit of €15,000. Each year she is also allowed capital allowances of €2,500.

    In year 1, Sam claims Start Your Own Business Relief against the profit of €3,000 and so can carry the €2,500 capital allowances forward.

    In year 2, Sam claims Start Your Own Business Relief against the profit of €15,000. She can carry the €2,500 capital allowances from 2015 forward, and the capital allowances of €2,500 from 2014. These can be used against her profits in 2016.

    In year 3, Sam will have €5,000 of capital allowances that she carried forward to set against any profits that arise in 2016.

Published: 30 January 2023 Print this page

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