(1)An averaging claim may be made under this section in relation to five consecutive tax years in which a taxpayer is or has been carrying on the qualifying trade, profession or vocation if the volatility condition in subsection (2) is met.
(2)The volatility condition is that—
(a)one of the following is less than 75% of the other—
(i)the average of the relevant profits of the first four tax years to which the claim relates;
(ii)the relevant profits of the last of the tax years to which the claim relates; or
(b)the relevant profits of one or more (but not all) of the five tax years to which the claim relates are nil.
(3)Any of the first four tax years to which an averaging claim under this section relates may be a tax year in relation to which an averaging claim under this section or section 222 has already been made.
(4)An averaging claim (“the subsequent claim”) may not be made under this section if an averaging claim in respect of the trade, profession or vocation has already been made under this section or section 222 in relation to a tax year which is later than the last of the tax years to which the subsequent claim relates.
(5)An averaging claim may not be made under this section in relation to the tax year in which the taxpayer starts, or permanently ceases, to carry on the trade, profession or vocation.
(6)An averaging claim under this section must be made on or before the first anniversary of the normal self-assessment filing date for the last of the tax years to which the claim relates.
(7)But see section 225(4) (extended time limit if profits adjusted for some other reason).]
Textual Amendments
F1S. 222A inserted (with effect in accordance with s. 25(12) of the amending Act) by Finance Act 2016 (c. 24), s. 25(3)