The Office for Tax Simplification (OTS) has published an analysis of the advantages and disadvantages of a change to the date of the end of the tax year for individuals.

The 70-page review considers the implications of moving the tax year to 31 December and 31 March.

Moving the end of the tax year to 31 March would help people understand the tax reporting process, and given how many businesses already use 31 March as the cut off date for accounting, HMRC may as well formalise the date as the tax year end, the report said.

For the tax year to align with the calendar year and end on 31 December would be "intuitive and logical", the OTS added, and bring the UK in line with the international community which typically uses the end of the calendar year as the tax year end.

A change would require a large amount of work to amend the vast amount of tax legislation that assumes 5 April to be the tax year end, while any transition period would have to be carefully considered with taxpayers in mind, the report highlighted.

Bill Dodwell, tax director at the OTS, said:

"This report presents information and analysis to inform evaluation and debate about the implications of any potential change and its timing.

"It does not aim to make a specific recommendation about whether the tax year should change."

Get in touch with us to discuss your accounting period.