Why does the tax year end on 5th April?
Historically, in the UK, the calendar year began on the 25th of March, known as Annunciation Day, which was 9 months before Christmas Day, and followed the Julian Calendar. This date also marked the start of the tax year.
Over time, it became evident that there was an 11.5-minute annual difference between the solar calendar and the Julian calendar. To address this, Pope Gregory XIII ordered a change, leading to the adoption of the new Gregorian calendar, which omitted a leap year every century for adjustment.
While Europe embraced this change in 1582, the UK resisted due to disputes with the Catholic Church and persisted with the Julian calendar.
By 1752, England found itself 11 days behind the rest of Europe. To realign, New Year’s Day was shifted to the 1st of January, and 11 days were dropped from the calendar, causing the 14th of September to directly follow the 2nd of September.
This adjustment sparked protests in Britain as citizens felt aggrieved at working only 354 days yet being required to pay taxes for a full year. To address this, the Treasury extended the tax year by 11 days, commencing it on the 5th of April, ensuring the collection of taxes for 365 days.
In 1800, the Treasury recognised that another day of taxes would be lost due to the leap year discrepancy between the Julian and Gregorian calendars. Consequently, the start of the tax year was moved forward one day to the 6th of April, with the end remaining on the 5th of April.
Several other countries, including Ireland in 2001, have synchronised their tax years with the calendar year.