wages/year end accounts
Discussion
Just been asked this and not having come across it before thought I'd ask if anyone knows...
If someone's pay isn't paid until after the year end (i.e. money doesn't leave bank account until after year end date), but applies to the period leading up to the year end, which year's accounts will it appear in....
Hope that's reasonably clear.....
If someone's pay isn't paid until after the year end (i.e. money doesn't leave bank account until after year end date), but applies to the period leading up to the year end, which year's accounts will it appear in....
Hope that's reasonably clear.....
sleepezy said:
assuming we are talking normal salary for an employee, not discretionary bonus or Directors salary, then it will be recognised in the year during which the liability arose (i.e. he/she worked) and accrued for in the accounts.
Thanks - thought as much but didn't know for sure.
If you are talking about a limited company you should:
accrue for the cost of the Gross Salary
accrue for the Employer's National Insurance arising on the Gross Salary
The salary muust be paid within 9 months of the accounting year end date.
If it isn't, the company will be laible to aditional Corporation Tax on the business profits.
accrue for the cost of the Gross Salary
accrue for the Employer's National Insurance arising on the Gross Salary
The salary muust be paid within 9 months of the accounting year end date.
If it isn't, the company will be laible to aditional Corporation Tax on the business profits.
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