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Cessation Accounting Periods

Heisenburg81 · 2017-04-01 12:09:32

Shouldnt all sole traders set up with an accounting period of 31st January due to the cessation rules? If taxed from 1st Jan to 31st Jan in a year you cease, and assuming falling profits, then 11/12ths of final year profits fall out of tax net? Not possible for December y/end.

01-04-2017 12:09pm

#1

Heisenburg81

Closed Accounts Posts: 322 ✭✭

Join Date: December 2016

Posts: 187

Shouldnt all sole traders set up with an accounting period of 31st January due to the cessation rules?
If taxed from 1st Jan to 31st Jan in a year you cease, and assuming falling profits, then 11/12ths of final year profits fall out of tax net?
Not possible for December y/end.

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Comments

#2 02-04-2017 11:11am

Penguin3029

Registered Users, Registered Users 2 Posts: 56 ✭✭

Join Date: February 2017

Posts: 47

No... Because the penultimate year is reviewed. For exactly this reason. And anything not taxed becomes taxed.

It's similar in application to the 2nd year excess relief (which works in the taxpayers favour). This works in the Revenue's favour.

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