A deduction is allowed for overlap profits (transitional or other) where a person ceases permanently to carry on a trade. All available overlap relief may be deducted at this stage, calculated as the total of all overlap relief arising in all overlap periods, less any relief already given on a change of accounting date (see ¶6175). The effect should be that a trader is taxed according to the number of years and months for which they have traded.

Example

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