Why does the new tax year start on 6th April?

Why does the tax year start on 6th April each year? Well, it used to be New Year’s Day!

In 1752 the British calendar aligned with the rest of Europe (moving from the Julian calendar to the Gregorian calendar) and moved New Year’s Day to 1 January. Until then New Year’s Day was 25th March annually, 9 months before Christmas Day known also as Lady Day or the day of Annunciation (the day that the Angel Gabriel appeared to Mary).

At the same time the calendar dropped 11 days from the calendar to fully align. In September 1752, 2 September was followed by 14 September. The people were unhappy with being robbed of 11 days of their lives and took to the streets to protest. The focus of their fury was that their taxes were not adjusted and so they were expected to pay a full year’s tax, despite the fact that the year had only 354 days.

The Treasury wanted to ensure there would be no loss of tax revenue and decided that the tax year should remain as 365 days. And so the beginning of the following tax year was moved from 25 March to 5 April.

Having done it once, the Treasury then decreed in 1800 that there would be another lost day of revenue, given that the century end would have been a leap year under the Julian calendar whereas it was not under the new Gregorian calendar. So 1800 was a leap year for tax purposes but not for the calendar. The tax year start was moved to 6 April and has stayed there since.

HAPPY NEW TAX YEAR!

PAYadvice.UK 6/4/2020

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s