If you’re a sole trader or in partnership you may need to show extra information when completing your 2023/24 tax return. What’s required and how might it affect your self-assessment payment due on 31 July?
Transitional year
2023/24 is the basis period transition year for businesses operating as sole traders and partnerships (including LLPs). Depending on your business accounting period end date this may require you to use different self-assessment pages to report your profits.
Tip. If your accounting period for 2022/23 ended between 31 March and 5 April 2023 (inclusive) you aren’t affected by the transitional changes and can therefore complete your tax return as usual.
Reporting profits
There are two versions of the self-employment and partnership pages which can be used to report your business profits. The short versions are SA103S and SA104S respectively for sole traders and partnerships, and the full versions SA103F and SA104F. If the transitional rule applies to your business, you must use the full version even if you’ve used the short version previously.
Additional information
When completing theSA103ForSA104Fyou need to enter details of the transitional profit and how you want it to be taxed (it can be spread over five years). Also, if you changed the end date of your accounting period in 2023/24 you’ll need to enter the details of this and may need to complete a second SA103F or SA104F depending on your new accounting date.
July payment
The second self-assessment payment on account (POA) is due on 31 July 2024. The standard amount payable is equal to 50% of your 2022/23 self-assessment tax. If your 2023/24 tax is greater, the POA due on 31 July won’t change. However, if it’s lower you can ask HMRC to reduce your POA. If you’ve already done so you should review whether the reduced amount is now sufficient taking account of the tax on your transitional profits.
If the basis period transition rules apply you must use the full version of the self-employed or partnership pages of your 2023/24 tax return. Include the tax on transition profits when checking if you can reduce your 31 July payment.
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