Basis period reform means that sole traders and partnerships will move to a tax year basis of taxation in 2024/25. Affected taxpayers must claim any remaining overlap relief to offset against their trading profits in 2023/24. This includes taxpayers who stop trading in the 2023/24 tax year.
Taxpayers may already know how much overlap profit they are carrying forward as they are including it on their self assessment returns. If the taxpayer (or their agent) does not have that information, a new online service is available to ask HMRC for the information it holds.
Agents can request the information on behalf of clients by using the online service with either their agent services account or online services for agents account sign in credentials. A separate request must be made for each client.
The information required to make a request includes:
- taxpayer name;
- name or description of the taxpayer’s business (or both);
- the business address;
- the taxpayer’s unique taxpayer reference (UTR) plus the partnership’s UTR if the business is part of a partnership;
- whether the business is a sole trader or partnership;
- the date the self-employment business began or the date the taxpayer joined the partnership (or the tax year if exact date unknown);
- the most recent period of account or basis period used;
- the year or years that the accounting period changed (where applicable); and
- whether the response should be sent by letter or email and the contact details for the response.
HMRC will provide a confirmation by letter or email that the request has been submitted. This will show the last four characters of the UTR, the taxpayer’s first initial, and the taxpayer’s last name.
HMRC endeavours to respond within three weeks, but complex cases may take longer.
The service is not available to trusts, estates, or non-resident companies with trading income. These groups should contact HMRC to find out how to obtain their overlap relief figure.
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