The ‘current year’ basis period rules apply:
The general rule is that the profits for a tax year are those
arising in the period of 12 months ending with the trader’s
accounting date in that year (ITTOIA05/S198).
The accounting date is the date in the tax year to which accounts are drawn up. Where accounts are drawn up to two or more dates in the same tax year, the accounting date is the latest of those dates (ITTOIA05/S197).
Different rules apply in the early years after the trade commenced, to the year of cessation, and for tax years in which there has been a change of accounting date.
Where no accounts are drawn up to a date in the tax year, the general rule is that the basis period for the tax year is the period of 12 months beginning immediately after the basis period for the previous tax year (ITTOIA05/S201)
This guidance is divided into four main parts: