Tyas & Company
Chartered Accountants, Registered Auditors, Tax, Business Advisors
Friday, 08 March 2019 00:01

Post cessation receipts and expenses

According to HMRC’s published guidance there are special rules for the taxation of post-cessation receipts and expenses. These provisions apply to professions, vocations and trades.

Tax relief may be available for post-cessation expenses of a trade, although such expenses still have to satisfy the wholly and exclusively test and be revenue in nature to qualify for relief. In order to be an allowable post-cessation expense, the trade must have ceased, and the expense would, in the normal course of events, have been deductible in calculating trading profits. Post-cessation expenses must be set against post-cessation receipts arising in the same period, before any other method of relief can be considered.

There are a number of different ways in which post-cessation expenses can be relieved. Relief will depend on the person incurring the expenditure and the type of expenditure incurred.

An expense specifically relating to the cessation itself is not an allowable expense.

 

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Stephen Tyas                             Stephen Ayres

 

 

Registered to carry on audit work in the UK as GBJ
Limited Liability Partnership by the Institute of
Chartered Accountants in England and Wales

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Telephone: 01293 843900

Fax: 01293 614312

Email: office@tyas.com

5 East Park, Crawley, West Sussex, RH10 6AN

 

 

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