• Contact us
  • About us
  • Digital edition
  • Online archive
Saturday, July 5, 2025
Cumberland and Westmorland Herald
  • News
    Man fined £100 for using cashpoint in car park

    Man fined £100 for using cashpoint in car park

    Honour for man who devoted his life to Greystoke

    Honour for man who devoted his life to Greystoke

    Sheep breeder’s successful debut at Royal Highland Show

    Sheep breeder’s successful debut at Royal Highland Show

    Global engineering firm Babcock supports Eden charity

    Global engineering firm Babcock supports Eden charity

    Penrith Lions mark 50 years of serving community

    Penrith Lions mark 50 years of serving community

    £8,000 for two new nature reserve projects

    £8,000 for two new nature reserve projects

    Fun day in Penrith to celebrate community spirit

    Fun day in Penrith to celebrate community spirit

    Arrests after shoplifting incidents in Penrith

    Arrests after shoplifting incidents in Penrith

    Anti-social residents move out after threatened with police order

    Anti-social residents move out after threatened with police order

  • Sport
    Penrith skipper Nicky Burns calls on team to keep winning

    Penrith skipper Nicky Burns calls on team to keep winning

    £100,000 target for new changing rooms extension

    £100,000 target for new changing rooms extension

    Medal success for Upper Eden tug-of-war team

    Medal success for Upper Eden tug-of-war team

    Eden man competes in Hyrox World Games

    Eden man competes in Hyrox World Games

    Double national triumph for Stuart Robinson

    Double national triumph for Stuart Robinson

    Patterdale’s Eden Eagles make history

    Patterdale’s Eden Eagles make history

    Penrith teen crowned British vault champion

    Penrith teen crowned British vault champion

    Penrith gymnasts represent North of England in finals

    Penrith gymnasts represent North of England in finals

    New boss revealed for Penrith AFC

    New boss revealed for Penrith AFC

  • Obituaries
  • Nostalgia
  • Online archive
  • Buy Photos
  • Buy your paper
  • North Lakes Living
No Result
View All Result
Cumberland and Westmorland Herald
  • News
    Man fined £100 for using cashpoint in car park

    Man fined £100 for using cashpoint in car park

    Honour for man who devoted his life to Greystoke

    Honour for man who devoted his life to Greystoke

    Sheep breeder’s successful debut at Royal Highland Show

    Sheep breeder’s successful debut at Royal Highland Show

    Global engineering firm Babcock supports Eden charity

    Global engineering firm Babcock supports Eden charity

    Penrith Lions mark 50 years of serving community

    Penrith Lions mark 50 years of serving community

    £8,000 for two new nature reserve projects

    £8,000 for two new nature reserve projects

    Fun day in Penrith to celebrate community spirit

    Fun day in Penrith to celebrate community spirit

    Arrests after shoplifting incidents in Penrith

    Arrests after shoplifting incidents in Penrith

    Anti-social residents move out after threatened with police order

    Anti-social residents move out after threatened with police order

  • Sport
    Penrith skipper Nicky Burns calls on team to keep winning

    Penrith skipper Nicky Burns calls on team to keep winning

    £100,000 target for new changing rooms extension

    £100,000 target for new changing rooms extension

    Medal success for Upper Eden tug-of-war team

    Medal success for Upper Eden tug-of-war team

    Eden man competes in Hyrox World Games

    Eden man competes in Hyrox World Games

    Double national triumph for Stuart Robinson

    Double national triumph for Stuart Robinson

    Patterdale’s Eden Eagles make history

    Patterdale’s Eden Eagles make history

    Penrith teen crowned British vault champion

    Penrith teen crowned British vault champion

    Penrith gymnasts represent North of England in finals

    Penrith gymnasts represent North of England in finals

    New boss revealed for Penrith AFC

    New boss revealed for Penrith AFC

  • Obituaries
  • Nostalgia
  • Online archive
  • Buy Photos
  • Buy your paper
  • North Lakes Living
No Result
View All Result
Cumberland and Westmorland Herald
No Result
View All Result
Home Expert advice
This article appears as part of a paid partnership with Armstrong Watson

What does the change in basis period mean for me and my farming business?

By David Threlkeld, accounting partner, Armstrong Watson

by CWH
31 January 2024
in Expert advice, Farm and Countryside
A A
Share on FacebookShare on Twitter
David Threlkeld

New legislation that affects how sole traders and partnerships are taxed is due to come into play on April 6 2024.

It means that businesses will be taxed on profits generated in a fiscal year and not those aligned to the business’s accounting year-end.

Who does the change in basis period impact?

It applies to anybody who is self-employed – sole traders and partnerships – with an accounting year end other than 31 March to 5 April. It does not apply to companies.

From which year does this take effect?

We are coming to the end of the transitional tax year 2023/2024 but if you are yet to look into this, there is still time. The issue comes when you need to submit your tax return for the year to April 5 2024 (any time up until January 31 2025).

Currently, you can choose any accounting year end you wish. For the tax year ended April 5 2023 this could be anywhere between April 6 2022 and April 5 2023.

For profits generated in the transitional year, regardless of what your accounting year end is, you will be taxed on the profits you generated in the year ending April 5 2024.

Do I have to change my accounting year end?

No, but if you decide to keep a year end other than March 31-April 5, when you get to the date for submitting your tax return and you haven’t done the accounts for the second part of that period, you will need to put an estimated profit on that tax return and then go back and correct it once you know the actual profit.

Using estimated profits has some consequences:

  • It is more hassle and expense to effectively do the tax return twice
  • There is more scope for underpaying or overpaying tax. If the profit in that set of accounts is higher than predicted, you’ve probably underpaid tax and might end up with an interest charge

Therefore, if you’ve got a year end late in the year, October or after, for simplicity, changing your year end to March 31 should be considered.

Why you might keep your accounting year end?

If a particular year end suits your business commercially and practically, you don’t have to change. For example, a beef and sheep farmer may be in the middle of lambing on March 31 and would not want the hassle of doing a stock count on that date. Could the timing of a major purchase of plant machinery in this transitional year of have an impact?

If you are considering buying a new tractor this spring, it could be beneficial to purchase it in March, rather than April if you are going to change your year-end, otherwise you would only be getting a proportion of your capital allowances.

How soon do I need to make a decision on whether or not I will change my accounting year-end?

Your year end and the figures need to be looked at in detail before the next tax filing season, so you need to be looking at it as soon as possible. The sooner, the better.

If you think you might change your accounting date to March 31, but you’re not sure, it would be wise to get some stock figures up to March 31, just so you’ve got them if you do change and they are needed. Either way this will give you more flexibility.

Tax simplification?

This isn’t something we can ignore. Regardless of whether you change or not, there are going to be challenges and you will still have to adapt to HMRC’s incoming changes.

While this change brings about little benefit to the taxpayer, it aims to simplify the taxation of unincorporated entities and ultimately means for HMRC the receipts of tax for such businesses will be accelerated.

Could this be the first step along the way to the self-employed and partnerships paying tax more frequently? Only time will tell.

For more information and advice about the change in basis period please contact 0808 144 5575 or email help@armstrongwatson.co.uk

Related Posts

Sheep breeder’s successful debut at Royal Highland Show
Farm and Countryside

Sheep breeder’s successful debut at Royal Highland Show

4 July 2025
Partnership vs company: Choosing the right structure for your farming business
Expert advice

Partnership vs company: Choosing the right structure for your farming business

29 June 2025
Is outsourcing a strategic opportunity amid rising employment costs?
Expert advice

Is outsourcing a strategic opportunity amid rising employment costs?

22 June 2025
Farms focus on cashflow following SFI scheme closure
Expert advice

Farms focus on cashflow following SFI scheme closure

21 June 2025
Risks and strategies for flexible pension drawdown
Expert advice

Risks and strategies for flexible pension drawdown

15 June 2025
Carbon audit produces positive results for North Sheep host family
Farm and Countryside

Carbon audit produces positive results for North Sheep host family

13 June 2025
No Result
View All Result

Stay connected

Facebook Twitter Instagram

Most popular

Fun day in Penrith to celebrate community spirit

Fun day in Penrith to celebrate community spirit

3 July 2025
Man fined £100 for using cashpoint in car park

Man fined £100 for using cashpoint in car park

4 July 2025
Anti-social residents move out after threatened with police order

Anti-social residents move out after threatened with police order

3 July 2025
Memory lane – a look at the Herald’s archive photos

Memory lane – a look at the Herald’s archive photos

4 July 2025
Penrith Lions mark 50 years of serving community

Penrith Lions mark 50 years of serving community

4 July 2025
Partnership vs company: Choosing the right structure for your farming business

Partnership vs company: Choosing the right structure for your farming business

29 June 2025
Cumberland and Westmorland Herald Logo

33 Middlegate
Penrith
Cumbria
CA11 7SY

Phone: 01768 862313
Email: news@cwherald.com

Registered in England as Barrnon Media Limited. No: 12475190
VAT registration number: 343486488

Explore

  • News
  • Sport
  • Farming
  • Property
  • Obituaries
  • Nostalgia
  • Your view

Useful links

  • Contact us
  • Photosales
  • Online archive
  • Buy your paper
  • Digital edition
  • North Lakes Living
  • Advertise
  • About us

Follow us on

© Barrnon Media Limited 2025

Terms & Conditions / Privacy Policy / Cookie Policy

This website and its associated newspaper are members of the Independent Press Standards Organisation
Review Your Cart
0
Discount
Add Coupon Code
Subtotal
Total Installment Payments
Bundle Discount
Checkout

 
0
No Result
View All Result
  • Home
  • News
  • Sport
  • Obituaries
  • Nostalgia
  • Online archive
  • more
    • North Lakes Living
    • Buy Photos
    • Buy your paper
    • About us
    • Contact us

© 2020 Cumberland & Westmorland Herald