ACCA Applied Skills · Taxation (UK) · Income from self-employment
Zara, a sole trader, has an accounting profit of £48,000 for the year ended 31 March 2026 after crediting £3,000 of interest received on a business deposit account and £1,200 of rental income from letting a spare room in her business premises, both of which are taxed elsewhere as non-trading income. What is her adjusted trading profit before capital allowances, ignoring all other adjustments?
Adjusted trading profit is £43,800. Interest and rental income are taxed as savings and property income, so the £4,200 is deducted from the accounting profit of £48,000.
- A£43,800Correct
- B£48,000
- C£51,000
- D£52,200
Explanation
Income taxed under other headings must be deducted from accounting profit in computing trading profit. Deduct £3,000 and £1,200 = £4,200. £48,000 - £4,200 = £43,800. Adding them would be the wrong sign.
Did you get it right without looking?
One question tells you little. A timed set on Income from self-employment shows your real accuracy, how long you take and where you lose marks.
More Income from self-employment questions
- Dev, a sole trader, prepares accounts to 31 March 2026. His accounting profit is £52,000 after crediting £4,000 of interest received on a bu…
- Which one of the following factors, when present, most strongly indicates that a disposal of goods by an individual amounts to a trade for i…
- Owen, a sole trader, has an accounting profit of £70,000 for the year ended 31 March 2026 after deducting: wages of £25,000 paid to Owen's w…
- Which of the following new items of expenditure by a sole trader qualifies for a 100% first year allowance?
- Mei, a sole trader, has an adjusted trading profit of £62,000 for the year ended 31 March 2026 before capital allowances. Capital allowances…
- Which one of the following is an allowable deduction in computing the adjusted trading profit of a sole trader?