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HMRC internal manual

Business Income Manual

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HM Revenue & Customs
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Averaging: claims: time limit

S222 Income Tax (Trading and Other Income) Act 2005

A claim for averaging must be made before the end of the first anniversary of 31 January following the end of the second tax year (so that for example a claim for averaging for 2011-12 and 2012-13 must be made by 31 January 2015). This is broadly 22 months after the end of the second tax year.

See, however, the second paragraph of BIM84150 regarding certain adjustments to assessments for earlier years and BIM84151 where a late claim is made in an enquiry case.

Notice of claim

Averaging claims are made in the return of the later year by including an averaging claim tax adjustment in that return. Where the qualifying trade etc. is carried on in partnership, each partner who wishes to take advantage of averaging must claim in respect of his or her own share of the profits in his or her personal return. Not all partners need to elect.

Withdrawal of claims

Withdrawal of claims may be allowed within the normal time limit.