Tax year

masskr

Advice needed please..
I'm on BTWE and going to file my own tax returns.
I started the business in August 2017, so from what month do I start with
August 2017 to August 2018
Or
January 2018 to present
Many Thanks

onlinepal100

Congratulations on the BTWE!

Assuming you are operating as a sole trader, then your Tax Year will end 31 December so for Year 1 you will file taxes for the calendar year 2017 including details of your business income.

For 2018 you will report business income for the full year.

adrianw

For sole trader commencement rules I understand your income will be reported as follows:

Year 1. Commencement to 31 December;
Year 2. First 12 months (so this would be start date August 2017 to August 2018);
Year 3. Actual business accounting year (if different to calendar year) and then compared year 2 to actual and if assessment to actual calendar year would have resulted in a lower tax bill you can amend for the difference in year 3.

masskr

Yes a sole trader..

Still unsure, so it Will it be from August (That's when I started ) to December 31st 2017.

Thanks

masskr

adrianw wrote: »

For sole trader commencement rules I understand your income will be reported as follows:

Year 1. Commencement to 31 December;
Year 2. First 12 months (so this would be start date August 2017 to August 2018);
Year 3. Actual business accounting year (if different to calendar year) and then compared year 2 to actual and if assessment to actual calendar year would have resulted in a lower tax bill you can amend for the difference in year 3.[/quote

Yeah I think I understand so from aug to dec 2017

onlinepal100

To be clear:

Year 1 - report all income for the period 1 January 2017 to 31 December 2017. This will include your benefit income from January to year end, plus your business income (net of expenses) for the period August to December 2017 plus any other income you might have (rental, interest etc.)

Year 2 and thereafter - 1 January 2018 to 31 December 2018. Report income from all sources.