Income Tax (Trading and Other Income) Act 2005 section 275B

Rule if there is a late accounting date

Section 275B provides a simplification rule for businesses whose accounting date falls between 31 March and 4 April, treating the short gap between that date and the end of the tax year on 5 April as if it produced no profits or losses.

• The rule applies where a business has an accounting date of 31 March or 1, 2, 3 or 4 April, the business was not started on or after 1 April of that tax year, and it did not permanently cease during that year.
• Any profits or losses arising in the short period from the day after the accounting date to 5 April are treated as nil for the relevant tax year.
• The actual profits or losses of that short period are instead treated as arising in the following tax year.
• Where accounts are drawn up to more than one date in the tax year, the latest of those dates is taken as the accounting date for the purposes of this rule.

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