Why does the tax year end on 5 April, and what's that got to do with Xmas?
Last review 18 December 2019
An oddity of the UK tax system is that the personal tax year runs from 6 April to 5 April of the following year.
Let's start with Christmas. 25 December. In the medieval period, it was traditionally one of the four "quarter days" when rents would be due and accounts settled. The days were (and still are!):
- Lady Day (25 March)
- Midsummer (24 June)
- Michaelmas (29 September)
- Christmas (25 December)
At this time, New Year was celebrated on the first of these, Lady Day (which commemorates the visit of the Archangel Gabriel to Mary, letting her know that she'll be the mother of Christ). To us it's an odd time to have a new year but there are two good reasons. First, it's close to the spring equinox when the days and nights are roughly equal. And second, it's at the start of a farming season ... so if someone is moving to a new plot of land, it's a good time to start and to settle with the landowner.l
Fast forward to 1752. Britain adopts the Gregorian calendar. This handles leap years better than the Julian version* and shifts the start of the new year to 1 January.
By this point, the calendars are out of sync by 11 days. So to adjust, when the calendar comes into effect, Wednesday 2 September is followed by Thursday 14 September.
However, to ensure the tax takings were still for a whole year, the compromise was that the tax year would continue up until the Julian tax year end 24 March, corresponding to 4 April in the new calendar. A couple of leap year resyncs later, and we've got a tax year running from 6 April to 5 April the following year.
*effectively the Julian calendar has a leap year every 4 years, but the Gregorian skips century years that aren't divisible by 400. So make a note that we'll roll straight from 28 February 2100 to 1 March 2100.