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Posted Thu, 07 Apr 2022 19:23:39 GMT by Charlie
Hi - I was hoping to claim income averaging for creators of literary or artistic works for this past tax year (2021-2022), but I noticed looking at the HMRC guidelines that it says "You cannot claim if your business started or ended in 2020-2021 or 2021-2022." I am a writer, and have been working on my current book since long before 2020, but I only officially registered as self-employed and completed Self-Assessment for the first time in the tax year 2020-2021, as that was when I first began to see profits. Does this mean that the date my business 'started' will be counted as 2020-2021, and I will not be able to claim income averaging this year? If so, that is very disheartening, as I thought this was exactly the situation for which the averaging relief was designed - for people who may work on an artistic project for several years without any payment and only see profit at the end...
Posted Wed, 13 Apr 2022 09:45:04 GMT by HMRC Admin 26

Please note that the guidance linked below considers the general principles which determine whether a trade or profession has commenced, and emphasises distinguishing between the acts of setting up and commencing.

The date of commencement will be a question of fact.       

Business Income Manual

Thank you.

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