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Change in Accounting date due to formation of Company from being a sole trader

ssrabbanissrabbani Just JoinedRegistered Posts: 2
Hi guys i need help with this.

Situation:
Sole trader wants to form a company which will be formed on May 01, 2013.
Normal accounting period is from April 01 to March 31.
I want to fill in tax return for the period 2012-13.
Can i prepare accounts for 13 months till April 30, 2013 for tax purposes?
What will be the accounting period? (Box 8 & 9 of Self Employment)
What will be the basis period? (Box 65 & 66 of Self Employment)
What will be the adjustment in Box 67 of Self Employment?

Comments

  • readerreader Experienced Mentor MAAT, AAT Licensed Accountant Posts: 1,042
    ssrabbani wrote: »
    Hi guys i need help with this.

    Situation:
    Sole trader wants to form a company which will be formed on May 01, 2013.
    Normal accounting period is from April 01 to March 31.
    I want to fill in tax return for the period 2012-13.
    Can i prepare accounts for 13 months till April 30, 2013 for tax purposes?
    What will be the accounting period? (Box 8 & 9 of Self Employment)
    What will be the basis period? (Box 65 & 66 of Self Employment)
    What will be the adjustment in Box 67 of Self Employment?

    I would have thought that all you need to do is:

    1) Prepare the 2012/13 tax return as normal + make a claim to reduce the payments on account (I'm assuming he's forming a company to avoid personal tax).

    2) Prepare the 2013/14 tax return showing 1 month of sole trade profits and cease the trade in that tax return. If he's paid any overlap tax you can claim overlap relief in this tax return as well.

    I think if would be a good idea if you read up on basis periods.
  • ssrabbanissrabbani Just Joined Registered Posts: 2
    Thanks
    I was thinking on the similar lines.
    I think this is the best way forward to keep sole trader separate from the company and start a new year for the company when it is formed.
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