Income Tax (Trading and Other Income) Act 2005 section 62

Apportionment of profits or losses to tax years before tax year 2005-06

Section 62 deals with how profits or losses of a property business are calculated and apportioned when the accounting period straddles the transition date of 6 April 2005.

• This provision applies where a property business has an accounting period that begins before 6 April 2005 and ends on or after that date.
• It covers situations where profits or losses from that straddling period need to be split in order to determine the taxable amount for a tax year before 2005-06.
• The profits or losses for the entire accounting period must be calculated using the rules in Part 3 of the Act, even though those rules technically apply from 2005-06 onwards.
• The calculated profits or losses may then be apportioned on a time basis under section 275 to any portion of the accounting period that falls in a tax year before 2005-06.