Cash basis vs accrual: which profit should I enter?

A beginner-friendly explanation of cash basis vs accrual accounting and how that choice changes the profit number you enter.

This calculator expects an annual profit figure; your accounting method affects that profit.
Cash basis profit follows money timing; accrual profit can differ.
If unsure, treat the output as planning and verify the rules on GOV.UK.

Why the method matters

Two people with the same business can show different profit depending on when income and costs are recognised. That changes estimates and cash planning.

What to enter

Enter the profit figure you plan to use for the tax year you selected, based on the method you use in your records.

Common mistakes

Mixing figures from different periods, or combining cash receipts with accrual style costs. Keep the tax year consistent.

Not tax advice. This page is an educational guide. For official rules, verify the sources below.

Open self-employed calculator How this is maintained

Last updated: 2026-04-20

FAQ

Does the calculator choose cash basis or accrual?

No. It uses the profit you enter.

Can I use this if my records are incomplete?

You can estimate, but do not rely on it for filing. Verify your final numbers.

Should I switch methods?

This page is not advice. Use GOV.UK guidance and professional help if needed.

Sources

For official rules and definitions, verify with the references below.

https://www.gov.uk/simpler-income-tax-cash-basis