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This guidance note discusses post-cessation receipts and expenses from a trade for either an unincorporated business or a company. The rules for post-cessation receipts and expenses from a property business are broadly the same but the underlying legislative basis is different. These rules are discussed in the Post-cessation receipts and expenses of a property business guidance note.

HMRC’s guidance is at BIM90000 onwards and see also Simon’s Taxes Division B2.8 for more details on post-cessation receipts and expenses.

Statutory references to ITTOIA 2005 relate to unincorporated businesses, and CTA 2009 relate to companies unless otherwise stated.

Accounts for a business are normally prepared on the accruals basis, so any post-cessation receipts and expenses are normally accounted for in the final period of trading. Such profits have been earned in that final period and the expenses incurred in that period and therefore they should have been recorded in that final period.

Occasionally, however, income may be omitted or may arise after the final period of trading. Similarly, expenses could be incurred in relation