Property income cash basis (UK individuals)
Under the property cash basis, an individual generally includes business receipts when received and allowable expenses when paid, subject to the relevant rules. For 2025–26, it is the default for most eligible individual property businesses with receipts no more than £150,000; a taxpayer may elect for traditional accruals accounting, and eligibility and exceptions must be checked. Do not confuse this property-business threshold with the separate post-2024 rules for trading income.
Worked example
An eligible landlord using the cash basis receives £12,000 rent and pays £2,000 of allowable expenses in 2025–26. A further £1,000 rent due in March is not received until May 2026. Assuming no other adjustments, the cash-basis property profit for 2025–26 is £10,000; the unpaid rent is not included in that year.
Common mistake
Including rent merely because it was due under the cash basis, or assuming a trading cash-basis rule automatically applies to property businesses.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | TX (UK) | Supporting | June 2026–June 2027 |