Finance Act 2024

Transitional provision

49 (1) This paragraph has effect for the purposes of construing references in the Income Tax Acts to a change in the basis of calculation of the profits of a trade (but not a property business) for the tax year 2024-25.

(2) A person carrying on a trade “enters the cash basis” in relation to the trade in the tax year 2024-25 if—

(a) the cash basis applies in relation to the trade for the tax year 2024-25, and

(b) no election under section 25A of ITTOIA 2005 had effect in relation to the trade for the tax year 2023-24,

and related expressions are to be construed accordingly.

(3) A person carrying on a trade “leaves the cash basis” in relation to the trade in the tax year 2024-25 if—

(a) an election under section 25A of ITTOIA 2005 had effect in relation to the trade for the tax year 2023-24, and

(b) the cash basis does not apply in relation to the trade for the tax year 2024-25,

and related expressions are to be construed accordingly.

(4) For the purposes of this paragraph, the cash basis applies to a trade in relation to a tax year if the profits of the trade for the tax year are required by virtue of section 24A(1) of ITTOIA 2005 to be calculated in accordance with that section.