Basis Period Reform is being introduced from the 6th April 2024 and will affect the self-employed who draw their accounts up to a date other than the 5th April (or 31st March equivalent).
The ’current year’ rules allow those who are self-employed to choose an accounting date to draw their accounts up to and are taxed on these based on the 12 months ending within the tax year.
As a result of Basis Period Reform you will instead be taxed on a ‘tax year’ (i.e. 6th April – 5th April) basis regardless of the accounting year end. 
A simple example of this is for a business which draws up accounts to 30th June every year. Currently income for 2024/2025 would be based on the profits of the business for the year ended 30th June 2024. Under Basis Period Reform it would mean that 3/12 of the profits from the year ended 30th June 2024 plus 9/12 of the profits from the year ended 30th June 2025 would be taxed in the tax year 2024/25.
To bring things into line ahead of the 6th April 2024 commencement date for Basis Period Reform, the tax year 2023/24 will become the year of transition and businesses will be taxed on their profits on the current year basis (i.e. 12 months ending in the tax year) in addition to those for the period up to the end of the tax year (i.e. 5th April 2024). This of course will accelerate an element of the profits into an earlier tax year therefore increasing tax liabilities and impacting on cash flow.
To help with excess profits arising in the transition year there is the option to spread them over a 5 year period, known as spreading relief.
Overlap profits which currently exist will also be taken into account in the year of transition.
If you have any queries in relation to the above, please contact us at hello@drummondlaurie.co.uk