(1)This section applies to professions and vocations as it applies to trades.
(2)To determine the profits of a trade for a tax year on the cash basis—
Step 1 Calculate the total amount of receipts of the trade received during F2... the tax year.
Step 2 Deduct from that amount the total amount of expenses of the trade paid during F2... the tax year.
(3)Subsection (2) is subject to any adjustment required or authorised by law in calculating profits for income tax purposes.
[F3(4)In determining the profits of a trade on the cash basis, section 7A(2) applies as if the profits or losses of a period of account were determined in accordance with subsection (2) of this section (and for these purposes, references in subsection (2) of this section to a tax year are to be read as references to a period of account).]]
Textual Amendments
F1Pt. 2 Ch. 3A inserted (with effect in accordance with Sch. 4 paras. 56, 57 of the amending Act) by Finance Act 2013 (c. 29), Sch. 4 para. 5
F2Words in s. 31E(2) omitted (6.4.2024 for the tax year 2024-25 and subsequent tax years) by virtue of Finance Act 2022 (c. 3), Sch. 1 paras. 7(2), 61(1)
F3S. 31E(4) inserted (6.4.2024 for the tax year 2024-25 and subsequent tax years) by Finance Act 2022 (c. 3), Sch. 1 paras. 7(3), 61(1)
