AAT Practice Assessment 2 Task 1B question
VijiVijins
Registered, AAT Student Posts: 9
in Business Tax
Hello guys,
Wonder if you could help with this task please. Do you know how do we get 32370 answer
Wonder if you could help with this task please. Do you know how do we get 32370 answer
0
Comments
-
The basis period for 2019/2020 was the year ended 30 April 2019
Therefore
The basis period for 2020/21 is from 1 May 2019 to 31 March 2021 ie. 23 months
The taxable income for the basis period is 22,770 + 18,400 = £41,170
Because this is >12 months, we can claim overlap relief
Because it is 11 months longer than 12 months, we can claim all 11 months of overlap profit ie. £8,800
Therefore
Taxable income = 41,170 - 8,800 = £32,370
1 -
That's great Peter, many thanks!0
-
You're welcome0
-
Hi, please could I have some further assistance with this question:
In the reference material it states the first accounts ending in the new date must not exceed 18 months in length. With that being the case how can the basis period be 23 months long?
Thanks and apologies if I am missing something obvious0
