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Home / Simons-Taxes /Business tax /Part B2 How are trade profits and losses calculated? /Division B2.1 Establishing trade profits and losses /Establishing trade profits and losses / B2.101 What profits and losses are taxable as trading income?
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B2.101 What profits and losses are taxable as trading income?


Business tax

Contents of Part B2

B2.1ÌýÌýÌýÌý Establishing trade profits and losses

B2.2ÌýÌýÌýÌý Trade receipts

B2.3ÌýÌýÌýÌý Trading expenses—general principles of deductibility

B2.3AÌýÌýÌýÌý Trading expenses—capital vs revenue

B2.3BÌýÌýÌýÌý Trading expenses—incurred wholly and exclusively

B2.4ÌýÌýÌýÌý Trading expenses—specific items

B2.5ÌýÌýÌýÌý Recognition of receipts and expenses in periods of account

B2.6ÌýÌýÌýÌý Trading stock

B2.8ÌýÌýÌýÌý Post-cessation receipts

Division B2.1ÌýÌýÌýÌý Establishing trade profits and losses

For updates affecting this Division please see Part B0 Updates

Establishing trade profits and losses

B2.101 What profits and losses are taxable as trading income?

A charge to income tax is imposed on1:

  1. Ìý

    •ÌýÌýÌýÌý profits arising from the trade, profession or vocation

  2. Ìý

    •ÌýÌýÌýÌý adjustment income, such as adjustments arising as a result of a change in accounting policy or those required by tax legislation

  3. Ìý

    •ÌýÌýÌýÌý post-cessation receipts arising after a trade has ended, which have not already been taxed

A UK resident is chargeable to tax on the profits of a trade no matter where that trade

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