Open consultation

Expanding the cash basis

• From: HM Revenue & Customs
• Published: 15 March 2023

Summary

We welcome views on options for extending the Income Tax cash basis for self-employed businesses which would allow more businesses to use the simpler regime.

This consultation closes at
11:45pm on 7 June 2023

Consultation description

This consultation welcomes views on options to extend the self-employed cash basis, which is a simplified way of calculating taxable profits for Income Tax purposes. The government wants to ensure as many businesses as possible are able to benefit from this simplification.

The consultation will focus on the four following policy proposals, but welcomes other ideas:

• increasing the turnover thresholds for businesses to use the cash basis
• setting the cash basis as the default, with an opt-out for accruals
• increasing the £500 limit on interest deductions in the cash basis
• relaxing restrictions on using relief for losses made in the cash basis

We would like to hear from businesses, particularly self-employed businesses that use or would be eligible for the cash basis, their advisers, representative bodies, software providers, and other interested parties.

Documents

Expanding the cash basis for the self-employed

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Ways to respond

Email to:

businessprofits.admin@hmrc.gov.uk

Published 15 March 2023