The cash basis is used by all unincorporated businesses whose total receipts are below £150,000 per annum (pro-rated for part years) as the default way of accounting for rental profits. However, an individual can elect for generally accepted accounting principles (GAAP) – sometimes known as the accruals basis – to apply instead to his property business. HMRC describe this as ‘traditional accounting’ on the SA105 additional pages of the self-assessment tax return (UK property pages).

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