Choice of basis for trades: cash or accruals

1. Certain unincorporated businesses [can opt to use the cash basis](https://library.croneri.co.uk/navigate-taxb/po-heading-id_LuxAk_DUW0Kipg32dnE5rA)

1.1. Turnover limit

1.1.1. Higher limit for universal credit claimants

1.2. Excluded businesses

1.3. Tick box on return

2. [Accruals basis](https://library.croneri.co.uk/navigate-taxb/po-heading-id_Yg80PciQbUqtWUoMLjhNiw)

2.1. Default option

2.2. Use generally accepted accounting practice (GAAP)

2.3. Record receipts and expenses applying to accounting period

2.4. Record stock, debtors and creditors

3. Businesses using cash basis [cannot benefit from certain tax rules](https://library.croneri.co.uk/navigate-taxb/po-heading-id_vNXUbY9T2E2upmlz2tfbGQ#po-heading-id_7j0IlpJBRkabEMtpi6uuvQ#)

4. [Other matters](https://library.croneri.co.uk/navigate-taxb/po-heading-id_8mJLbrvAWEGUCUGUSB2zVg)

4.1. Capital allowances

4.2. Trade losses

4.3. Post-cessation receipts

4.4. Interaction with CGT

4.5. NICs

4.6. Universal credits

4.7. Barristers and advocates

4.8. VAT

5. [Transitional arrangements](https://library.croneri.co.uk/navigate-taxb/po-heading-id_0wlJghH3TkOOtoggCqwTaA)

5.1. Entering the cash basis

5.2. Leaving the cash basis

6. Cash basis provides [simpler administration](https://library.croneri.co.uk/navigate-taxb/po-heading-id_OV0rVemkg0muA0VLk0Dtiw)

6.1. Not as simple as taxing based on cash flow