Lee Sharpe looks at the recently-introduced cash basis of assessment applicable to landlords.
The cash basis for property businesses was introduced via F(No 2)A 2017 Sch 2, and its effect is felt liberally around ITTOIA 2005 Pt 3, dotted mainly around ITTOIA 2005 ss 271A–276A, and ITTOIA 2005 ss 307A–307F.
It was, in fact, introduced several months after the date from which it was scheduled to have an effect – that is, from 6 April 2017. HMRC guidance is in the Property Income manual at PIM1090-PIM1098, but it does not reflect the full complexity of the regime.
It is essential readers beware that, where the cash basis can apply, it is deemed to apply automatically, unless the taxpayer elects out of the regime. This is unlike the cash basis for trading entities, which requires a positive election into the regime (ITTOIA
