Section 107 Apportionment of profits

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(1) Where in the case of any profits or gains chargeable under Case I, II or IV of Schedule D it is necessary, in order to determine the profits or gains or losses of any year of assessment or other period, to divide and apportion to specific periods the profits or gains or losses for any period for which the accounts have been made up, or to aggregate any such profits or gains or losses or any apportioned parts of such profits or gains or losses, it shall be lawful to make such division and apportionment or aggregation.

Is it lawful to apportion profits or gains under Schedule D Case I, II or IV to accounts periods?

(1) Yes.

(2) Any apportionment under this section shall be made in proportion to the number of months or fractions of months in the respective periods.

How should apportionment of profits or gains to accounts periods be done?

(2) On a time basis, i.e., in proportion to the number of months (or fractions of months) in the accounts period (see section 66).