Commentary on Sections Overview Overview
812.Profits for a tax year are taxed by reference to the amount of profit earned in the basis period for that tax year.
813.This Chapter gives the rules that identify the basis period for a particular tax year.
814.For established, on-going trades with a constant accounting date – the majority of cases –the rules operate very simply: the basis period for a tax year is the 12 month period ending on the accounting date in that year.
815.But special rules are needed when a trade begins or ends. And further rules have to deal with less common events such as a change of accounting date or if accounts are regularly prepared to a particular day (rather than a particular date) in the year.
816.The rules in this Chapter are ordered so that the rules dealing with the more unusual cases are located at the end of the Chapter: the simplest cases are fully dealt with by the first six sections.