Basis periods

111beckstar111

IS THERE ANYONE ON HERE THAT CAN HELP ME DISCUSS BASIS PERIODS AS REALLY STRUGGLING. IF SO DO YOU HAVE MSN TO MAKE IT EASIER?????? HELLLPPP:001_smile:

TheGrandeMasterSmag

hey, i'm a bit hazy on this, but here goes, hopefully it'll help a bit....

I assume you're talking about basis periods in BCT, not sure if they're in anything else....

so, for section 1 - sole traders and partnerships

this one is where you have to do the periods according to the tax year. e.g april 08 - april 09

if i recall, there are tonnes of rules about this, but basically:

if you start business 1st jan 08, then the tax you pay in 07/08 is the first 3 months. (up to 5th april 08)

Then you take the twelve months from the beginning of your business for the tax year 08/09.

tax year 09/10 is for the next 12 months following on from the last year, and so on ...

there is the OVERLAP period which is the bit that is taxed twice (the first 3 months in this case)

If you draw a time graph it helps HUGELY!!!

plus you have to pay in three installments:

for 08-09: 31st jan 09, 31st july 09 and 31st jan 10

section 2 - companies

this is done according to the company's year. you just split it into two parts if it crosses two tax years.

e.g company tax year 1st jan 08 - 31st dec 08
3 months fall within 07/08 tax year
9months fall within 08/09 tax year

so just apportion the pctct and the tax bands accordingly and bob's y'uncle!

If any of this is wrong, then sue me, Ah'm just tryin' to 'elp guvnor.

lucy1988

whats you hotmail?

lucy1988

Does anyone know what to do with losses for business tax?

jimmyt1988

Just for information i went through something the other day about this,

draw 3 lines on a piece of paper, from 6/4/07 - 5/4/08, and 6/4/08 - 5/4/09 etc for 3 years, with the first line being the year your start date falls into.

Mark on the lines your Business commencement date, and your first year end date + any year end dates after that.

Your first year is always from the start date, to the end of the first line, apportioning where necessary. For example if your start date is 1st June 2008, your would do 1st June 2008 - 31st March 2009.

Your second year varies, if the year end falls on the second line, you go 12 months back from that date and calculate. For example, 31st June 2009, you would calculate 1st July 2008 through to 31st June 2009. If you can only go back 7 months from the first year end (ie a short period), you must extend it 5 months after the year end date. If NO year end date appears on the second line, you calculate it from 1st April - 31st March on the second line.

Third year is always calculate 12 months back from the financial year end date for the year. So i make a mark on the third line and go 12 months back and calculate.

Any period that falls into 2 different years is your overlap, you should be able to see this on a diagram.

Hope this helps, hard to explain in text, but i did this for my group at college and it seemed to reep rewards for them, If you need me to explain more in detail, i will attempt to, just ask.


Just as a different approach

Thanks and good luck,
Jamie