HMRC are reminding sole trader and partnership businesses that do not use the tax year as their accounting date, that they need to prepare for the new basis period reform rules, which apply from 6 April 2023.
From 6 April 2024, businesses will be assessed on profits for each tax year that runs from 6 April to 5 April. This change will affect how sole traders and partnerships complete their tax returns if they use an accounting date between 6 April and 30 March.
The tax year 2023–24 will be a transition year, to allow any overlap relief that a business may be due to be used against profits for that tax year.