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betty121


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Year end dates
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Morning everyone,

 

I'm doing a set of accounts and tax return over the weekend.  It's a sole trader start up.  My client told HMRC she started her business on 05.04.11 and 2011/12 financial year is her first return.  She has pre-trading expenditure.  Question is this.  Is it ok to ignore the 05.04.11 (as it's financial year 2010/11) and start everything up from 06.04.11.  I would then put the pre-trading expenditure through on 06.04.11.  As it is only one day I'm sure HMRC would be ok with this.  I am right?

Thanks as always for any help.

 

Elizabeth



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Shamus


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Is that what the client wants or were they manipulating their dates to ensure a first year loss by bringing everything into the company before any possibility of income?

If so they have made a mistake and should have chosen a date at least 6 days before the tax year end.

Even were this not a BIM71020 case don't forget that allowances would be pro ratered so her actions may not prove as beneficial as she believes.

I would clarify the situation with the client to determin their understanding and expectations first before making any decisions on their behalf,

See here for BIM71020 :

http://www.hmrc.gov.uk/manuals/bimmanual/bim71020.htm

kind regards,

Shaun.

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Shaun

Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
betty121


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Shaun,



Thanks I will have a look at the link and speak to the client.

Oh PS Happy 3rd Birthday.

Elizabeth











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