Transitional previous year modifications adjust monetary limits, time thresholds, depreciation and tax computation for extended accounting periods. Where the previous year exceeds twelve months, that period is a transitional previous year and specified monetary limits, time period thresholds and ... Summary
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Transitional previous year modifications adjust monetary limits, time thresholds, depreciation and tax computation for extended accounting periods.
Where the previous year exceeds twelve months, that period is a transitional previous year and specified monetary limits, time period thresholds and allowances are increased pro rata by multiplying amounts or allowances by a fraction equal to the number of months in the transitional previous year divided by twelve (with rules for rounding partial months). Section 6 day count thresholds and depreciation allowances are modified proportionately where extended periods or multiple discrete periods are included, tax is computed by annualising income to an average rate, and the Board may grant relief to avoid genuine hardship.
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