How can I shorten the basis period?
I have a sole trader client whose business is generating profits and whose year end is 30th April.
For reasons best known to himself he decided, with the help of an outside consultant, to cease trading as a sole trader on 31st March 2011 and to form two new companies who purchased the business, and who began trading on 1st April 2011. As far as I know there was no actual legal documentation reflecting the sale.
The staff have been transferred to the new companies and subsequent VAT returns reflect this change of status. As he sold the business as a going concern to non VAT registered companies there was VAT on the consideration (paid in instalments), but apart from that the VAT returns have had no output or input tax on subsequent VAT returns.
The 2010/11 tax return would ordinarily reflect the basis period as the year to 30th April 2010. Because of the way he sold the business I believe the basis period is now the period 1st May 2009 to 31st March 2011 - an extremely long period of account and one which will generate a huge tax bill.
I am racking my brains to see if I can justify a second basis period for the self employment which ends in the 2011/12 tax year, which should allow a lower overall tax bill. I wonder if anyone had any thoughts?
- Are solicitors worth the money? 1,319 13
- Does the AR01 reflect the actual money invested in a company 61 4
- Can we learn from the financial services industry? 204 8
- Spam blocking 437 27
- A little silliness 258 3
- Just for fun. 822 27
- Is interest still due? 52 1
- AccountingWeb is unworkable 319 2
- How long to process paper 64-8 (SA)? 126 2
- Ex-gratia payments 280 6
- Splitting PAYE tax code between two jobs both with variable hours 117 4
- Director needs to withdraw 45k lump sum from company 345 6
- HMRC & daft penalty 615 6
- TOMS - the other side of the fence 131 2
- &^$%ing Mollom? 230 2
- Employment status 268 4
- Has auto-enrolment tipped the scales? 147 1
- P11D help 120 2
- VAT on purchase of plant from Germany 147 4
- Contract Hire Van, reclaiming input VAT 141 1
- Theatre Tax Relief 489
- Has anyone been affected by the RBS payment breakdown? 383
- Windows 10 on-going support ... 374
- Straight line write off of Purchase Goodwill ??? 348
- Perkbox 313
- Self Assessment - What to enter on the return 309
- Compensation - Taxable or not then CGT or IT 273
- FRS 102 compliant illustrative accounts for an insurance company 271
- Document Management Systems 253
- WIP Software 236