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A farmer joined a farming partnership on 1st April 2019.

In 2018/19 he had 5 days profits assessed at, lets say, £820.  In 2019/20 he is allocated a profit of £60,000 from the year ended 31st March 2020.

My question is - can he average 18/19 and 19/20? I know you cannot average in the year of commencement but whilst it is the accounting year of commencement, it is the second year of tax assessment. 





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Lone Wolf
By Lone_Wolf
12th Jan 2021 14:48

I don't think so.

The legislation says:

222(4) An averaging claim may not be made under this section in relation to the tax year in which–

(a)the taxpayer starts, or permanently ceases, to carry on the trade, profession or vocation, or

(b)in the case of a trade, profession or vocation within section 221(2)(c), it begins or ceases to be a qualifying trade, profession or vocation.

By averaging with 2018/19, I'd say this counts as a claim in relation to the tax year of commencement, and so cannot be made.

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Replying to Lone_Wolf:
By Kaylee100
12th Jan 2021 15:13

Ahh, penny drops. I was thinking I was averaging 19/20 but I'm not, I am averaging 18/19 with 19/20, which includes the year of commencement.

Well, I'm not now averaging it of course! Thanks very much for your help.

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