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Where Taxpayers and Advisers Meet

Can I even put tax by changing my basis period ?

billyg
Posts:117
Joined:Wed Aug 06, 2008 3:47 pm
Can I even put tax by changing my basis period ?

Postby billyg » Sat Jan 15, 2022 11:08 pm

I am self employed-sole trader.
Like many people my income dwindled on 20/21
My year end is 5 April

My income was a lot better after 5 April 21 I am wondering if I can even this out by maybe extending my basis period to for instance August 21 ?

Thanks in advance

bd6759
Posts:3744
Joined:Sat Feb 01, 2014 3:26 pm

Re: Can I even put tax by changing my basis period ?

Postby bd6759 » Mon Jan 17, 2022 1:45 am

Your current period of account for 2020-21 is 6/4/2020 to 5/4/2021. Your basis period for 2029-21 will also be 6/4/2020 to 5/4/2021 because that is the accounting date that falls in the tax period.

If the change your period account to 5 August 2021 you will not have an accounting date that ends in 2020-21. Your basis period for 2020-21 will therefore be the tax year6/4/2020 to 5/4/2021. The profits attributable to that basis period will be a simple apportionment of your long (17 month) period of account: 12/17th of your profit.

Your basis period for 2021-22 will be the 12 months ending on 5 August 2021, again calculated on simple apportionment of 12/17ths of your profits to that date.

Basis periods are being abolished, you will need some proper advice to determine if doing that will be beneficial.


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