If your accounts end on a date other than 31 March to 5 April, your taxable profit for a tax year is built from two sets of accounts: the part of the earlier year that falls after 5 April, and the part of the later year that falls before the next 5 April. The split is normally made by days. Where the later accounts are not finished by the filing deadline, you file with provisional figures and amend the return when the accounts are final.

Why do two sets of accounts feed one tax year?

Since 2024 to 2025, sole traders and partners have been taxed on the profits arising in the tax year (section 7A of the Income Tax (Trading and Other Income) Act 2005). A business with a 31 December year end therefore no longer reports one year’s accounts. HMRC’s own example: for 2024 to 2025, the profit from 6 April to 31 December 2024 is added to the profit from 1 January to 5 April 2025. The background is covered in basis period reform and the tax year basis.

Section 7A permits two steps: apportioning the profit or loss of a period of account between the tax years it straddles, and adding together the profits or losses of different periods (or parts of them). Losses are apportioned in exactly the same way as profits (BIM81201).

How is the apportionment calculated?

Section 7A(3) requires the steps to be taken by reference to the number of days in the periods concerned. In practice that means:

Tax adjusted profit of the period of account x days of that period falling in the tax year / total days in the period of account

Section 7A(4) allows another measure, such as months or weeks, if it is reasonable and used consistently for the trade. HMRC’s guidance shows both methods. Count the actual days, including 29 February when it falls in the period: HMRC’s transition year examples divide by 366 for accounts covering February 2024, and the next leap day is 29 February 2028. BIM81201 also notes that, more unusually, apportionment may not be needed where a more accurate figure can be found from the actual transactions in the period, citing Marshall Hus & Partners Ltd v Bolton, though HMRC expects that only where there are relatively few identifiable transactions.

What does that look like with real dates?

Illustration only. A sole trader makes accounts up to 30 September. The tax adjusted profit is £36,500 for the year to 30 September 2026 and £43,800 for the year to 30 September 2027. Neither period contains a 29 February, so each has 365 days.

Part of 2026 to 2027 Days Calculation Profit
6 April to 30 September 2026 178 £36,500 x 178/365 £17,800
1 October 2026 to 5 April 2027 187 £43,800 x 187/365 £22,440
Taxable profit 2026 to 2027 £40,240

The remaining 178 days of the 2027 accounts will form part of the 2027 to 2028 profit, together with 188 days from the accounts to 30 September 2028 (that period includes 29 February 2028 and so has 366 days).

When are provisional figures needed?

The 2026 to 2027 return must be filed online by 31 January 2028. For a 30 September year end, the accounts to 30 September 2027 should be ready in time. For a later year end, they may not be. A business with a 31 December year end needs the accounts to 31 December 2027 to work out its 2026 to 2027 profit, just one month before the filing deadline.

HMRC’s instructions are that if you do not know your profit for the whole tax year by the deadline, you still file on time, work out what it is likely to be, include those “provisional figures” and tell HMRC you have done so. On the self employment (full) pages you complete only a limited set of boxes and use box 103 “Any other information” to say why you have used provisional figures and when you expect to give the final ones. HMRC’s manual at SALF206 adds that a provisional figure should be clearly identified, should be a best estimate, and should only be used once it is clear a more accurate figure will not be available before the filing date.

What happens when the final accounts are ready?

You amend the return. HMRC allows 12 months from the Self Assessment deadline to make the change. If more tax is due, interest runs from the original payment date on the difference between the estimate and the final figure; if you overpaid, HMRC pays you interest. See our guide to amending a Self Assessment return and to HMRC late payment interest.

SALF206 warns that a penalty for a careless or deliberate inaccuracy can be charged if there was no good reason to use a provisional figure or it was not reasonably estimated, and that unreasonable delay in giving the correct figure can itself lead to a penalty. A sensible estimate is usually based on management accounts or the trend of earlier years, with a note on file explaining how it was reached.

Are there dates where no apportionment is needed?

Yes. Under section 7C, if accounts are made up to 31 March or 1, 2, 3 or 4 April, the profit for the remaining days to 5 April is treated as nil for that tax year and as arising in the next one, so the accounts can be used as they stand. Under section 7B, a trade starting between 1 and 5 April is treated as having nil profit in that first short tax year. A trader can elect out of both rules under section 7D, by the first anniversary of the normal filing date for the first year concerned, and the election then lasts for five tax years unless the trade stops. HMRC says it may be easier to prepare accounts to 31 March or 5 April because you will not need to use two sets of accounts.

How do you complete the return with two sets of accounts?

HMRC’s notes to the self employment (full) pages say the full pages are needed if your accounting period ended before 31 March or was not 12 months long. If more than one set of accounts ends in the tax year, you fill in boxes 1 to 65 and 83 to 99 on separate pages for each set, then complete the adjustment boxes on the pages for the most recent set. The apportionment adjustment goes in box 68, and any slice of 2023 to 2024 transition profit goes separately in box 73.3; see spreading transition profits.

Partners apportion their share of the partnership’s profit in the same way when the firm’s accounting period does not match the tax year, according to HMRC’s helpsheet HS222.

What mistakes should you avoid?

  • Switching methods. Days one year and months the next fails the consistency condition in section 7A(4).
  • Forgetting 29 February. Accounts covering February 2028 have 366 days.
  • Filing late to wait for accounts. Late filing penalties still apply; use provisional figures instead.
  • Not amending. A provisional figure left in place indefinitely invites an enquiry and possible penalties.
  • Apportioning the profit before tax adjustments. Apportion the adjusted profit or loss of each period, not the figure in the accounts.

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Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.