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The tax year 2001-02 means the year of assessment beginning on 6 April 2001, as section 832(1), Taxes Act 1988 tells us, but as my grandson Sam would say – why? Sam is unlikely to stay long enough for the full answer, because the origins lie some 2,700 years ago.
The early Roman calendar
The tax year 2001-02 means the year of assessment beginning on 6 April 2001, as section 832(1), Taxes Act 1988 tells us, but as my grandson Sam would say – why? Sam is unlikely to stay long enough for the full answer, because the origins lie some 2,700 years ago.
The early Roman calendar
In the early Roman calendar, supposedly established by Romulus, the year began on 1 March and had ten months; hence 'Sept'ember was the seventh month. Around 675 BC, Numa Pompilius, the traditional second king of Rome, is believed to have added January and February. Around 585 BC, Tarquinius Priscus, the traditional fifth king of Rome, made reforms but the Romans disliked even numbers so they had four months of 31 days, seven of 29 days and February with 28 days, producing a year of 355 days. This approximated to 12 lunar months of about 29.5 days (which the Jewish calendar still has).
Julius Caesar
The authorities were supposed to insert an extra month every three years but they did not always do so and the calendar got into such a muddle that Julius Caesar, while Pontifex Maximus, enlisted the assistance of the Egyptian astronomer, Sosigenes. This was in the year 707 AUC (ab urbe condita, or from the foundation of Rome) which we know as 46 BC. To put matters right, that year had 445 days and is called, not surprisingly, the Year of Confusion.
Thereafter, each year was to have 12 months with 31 and 30 days alternately, but ending with 29 in February; this later became 28 when August (named after Augustus) received an extra day so that it was not shorter than July (Julius). This gave 365 days but Sosigenes was aiming at a solar year of 365.25 days and added a leap day every fourth year to February.
Lady Day in England
In England during the seventh century the spread of Christianity led to Christmas Day being recognised as the beginning of the year. However, in the twelfth century the church decreed that the year should begin on Lady Day (25 March) the Feast of the Annunciation of the Virgin Mary, nine months before Christmas Day, and by the fourteenth century this was generally accepted.
Papal reform
As noted earlier, the Julian Calendar supposed that the length of the solar year was 365.25 days, whereas in fact it is 365.2422 days, so there was an error of 0.78 days per century or 3.12 days per 400 years. In 1545 the Council of Trent noted that when Constantine the Great had convened the Council of Nicaea in 325 AD, to agree the Christian creed and the date of Easter, the spring equinox had fallen on 21 March, whereas it was now falling on 11 March, a difference of ten days. Pope Paul III was asked to rectify the calendar, but it was not until 1572 that the Jesuit astronomer Christopher Clovius found a solution. As a result, Pope Gregory XIII proclaimed that 5 October 1582 should become 15 October, and that in future only the fourth of the end-century years should be a leap year. This corrects three days each 400 years; the remaining error of 0.12 days per 400 years is rectified substantially by providing that the years 4000, 8000, etc. are not leap years. The remaining error is only one day in 20,000 years!
Slow implementation
Roman Catholic countries changed quickly but other nations were slow to do so and when Pepys visited the Continent in 1660 their reckoning was ten days ahead of Britain's. Britain caught up in 1752 but was not the last country to do so; later countries include Japan (1872), China (1912), Russia (1918) and Greece (1923). The Calendar (New Style) Act 1750 provided that Great Britain would conform with the Gregorian Calendar. The year 1700 had been treated as a leap year, so a jump of 11 days was necessary, and 2 September 1752 was followed by 14 September.
Tax effects
Following the church's lead with tithes, the land tax and other taxes had been imposed for legal years ending on 25 March. So that the land tax year of assessment 1752-53 covered a full 365 real days, it began on 26 March 1752 but finished on 5 April 1753.
Thus a twelfth century church decree and an eighteenth century calendar reform led to years of assessment ending on 5 April being operative when income tax was introduced in 1799 and reintroduced in 1803 and 1842. Capital gains tax followed suit in 1965, but it is somewhat surprising that the annual and small gifts exemptions in sections 19 and 20, Inheritance Tax Act 1984 should be calculated by reference to a year ending on 5 April.
The possibility of altering the date of the tax year has been examined on occasion but no change has been recommended, so our unique tax year seems likely to remain with us.
So, did you follow all that, Sam?... Where are you, Sam?
John Jeffrey-Cook is Clerk to the Company of Tax Advisers, a Guild of the City of London. He is grateful to the editors of the British Tax Review for permission to update the article he wrote in 1977.
