Should I change my BTL Limited Company Year End?

Apr 12, 2022

Is your BTL limited company year end making life difficult for you? Unlike personal tax, for which we all file a tax return to the 5th April each year, limited companies file accounts based on accounting periods. The first accounting period usually covers more than 12 months because the starting date is the date that the company was incorporated ending on the ‘accounting reference date’, i.e. the last day of the month the company was set up. In the following years, the accounting reference date will normally cover the company’s financial year.


If a company is incorporated on 21st August 2022, its accounting reference date will be 31 August 2023, so the first accounts cover 12 months and 10 days. The accounts will be from 1 September to 31 August in the following years.

Why consider changing the year-end date

For many landlords trying to keep a track of personal income and income from their BTL limited company can become cumbersome because of the differing year ends. Preparing accounts for the company to say 31st August whilst having to report their income to 5th April often leads to confusion, the juggling of payment of dividends and problems with the repayment of an overdrawn directors loan account.

Further issues arise when trying to put together a statement of up to date earnings for mortgage lenders. Many landlords are also not sure of what their likely income for a tax year will be until nearer the 5th April so tax planning to take advantage of say any lower rate tax band can become a bit hit and miss.

So what year-end date should you have?

For most landlords, we suggest either a 31st December or 31st March year-end. A March year-end aligns your company accounts with your personal income and makes it easier to understand both. A December year end leaves you enough time to adjust any income you may wish to draw before the tax year-end and also makes provision for pension contribution planning much easier.

This is just one of the ways we can help you run your BTL limited company so that it works for you. Speak to me or one of our team of specialist property accountants today to fix up a FREEno-obligation consultation about all things property. Call us now on 01902 711370 or 0800 907 8633.

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