Sole Trader - Accounts
Discussion
Morning,
I managed to make a start on my accounts last night. I wish I had actually made an attempt to keep track of everything instead of just chucking invoices and receipts in a drawer....
HSBC Business banking only seem to hold electronic accounts for the last 3 months. I assume the onus on me is to provide the tax man with the details on tax deductable expenses, and not my personal withdrawls? I'm seeing my accountant on Thursday, but want to at least turn up with at least the right details for him to work from. (I assume my purchases, milage, and details of my home office will suffice)
Thanks....
I managed to make a start on my accounts last night. I wish I had actually made an attempt to keep track of everything instead of just chucking invoices and receipts in a drawer....
HSBC Business banking only seem to hold electronic accounts for the last 3 months. I assume the onus on me is to provide the tax man with the details on tax deductable expenses, and not my personal withdrawls? I'm seeing my accountant on Thursday, but want to at least turn up with at least the right details for him to work from. (I assume my purchases, milage, and details of my home office will suffice)
Thanks....
I always ask to see my clients' entire bank statements for the year.
You are legally obliged under Self Assessment to maintain bank (and other financial) records for up to EIGHT YEARS after your financial year end date.
If you have not been printing off or receiving paper bank statements from your bank on a regular basis, you may find that you have inadvertantly transgressed the legal requirement to keep records.
Please note that you don't have to keep the records in a paper for, but you must have kept them somehow in such a way that, if the Revenue want to see them, they are available.
I'm sure the bank can supply you with all the statements you require, but you may have to pay them extra to obtain this information now.
You are legally obliged under Self Assessment to maintain bank (and other financial) records for up to EIGHT YEARS after your financial year end date.
If you have not been printing off or receiving paper bank statements from your bank on a regular basis, you may find that you have inadvertantly transgressed the legal requirement to keep records.
Please note that you don't have to keep the records in a paper for, but you must have kept them somehow in such a way that, if the Revenue want to see them, they are available.
I'm sure the bank can supply you with all the statements you require, but you may have to pay them extra to obtain this information now.
Edited by Eric Mc on Tuesday 12th August 10:40
I don't think I've thrown away paper statements, they have probably just been all stuffed in a box. (I've always relyed on internet banking to provide me with all my statements going back)I tend to hoard, but in a disorganised fashion. Paying for that mistake now.
I work full time as well as this little venture. I assume all my PAYE payslips would be required for the year so the tax can be worked out. (Thought, I've been paying 40% tax and the top NI bracket. I therefore assume my company profits will be taxed at 40%, but if my NI has reached the threshold, will there be any extra to pay? I'm only been paying quarterly so far)
I work full time as well as this little venture. I assume all my PAYE payslips would be required for the year so the tax can be worked out. (Thought, I've been paying 40% tax and the top NI bracket. I therefore assume my company profits will be taxed at 40%, but if my NI has reached the threshold, will there be any extra to pay? I'm only been paying quarterly so far)
You don't NEED to keep all your weekly/monthly PAYE payslips for tax purposes. The full details of your PAYE earnings should be contained on your P60 for 2007/08. Also, make sure you have your most up to date PAYE Coding Notice for 2007/08 as well as that may contain details which will be necessary for your accountant.
You have just used the word "company" with reference to your business. Are you running a sole-trader or a limited company?
You have just used the word "company" with reference to your business. Are you running a sole-trader or a limited company?
Sole trader, my mistake. I should refer to it as my 'part-time enterprise' I suppose.
I have the P60, but I started trading in August 07 and wanted to work out my tax for a 12 month period, so the P60 would be slightly inaccurate in that respect. Still, this is what I'm going to see the accountant for!
I have the P60, but I started trading in August 07 and wanted to work out my tax for a 12 month period, so the P60 would be slightly inaccurate in that respect. Still, this is what I'm going to see the accountant for!
The P60 should reflect ACCURATELY your tax liability arising on the salaried part of your 2007/08 income.
Obviously, whether you have any additional tax and NI liabilities arising from your self employed activity will depend on how prifitable the business has been in the 2007/08 tax year.
Don't forget that the Revenue's definition of "profit" may be different from what you expect and that you will be allowed deduct normal day to day business expenses plus Capital Allowances from your overall business income before you arrive at a taxable profit. Indeed, sometimes, by the time all the business allowances have been taken into account, you might arrive at a tax deductable loss. If that actually happens, you can offset the loss against your already taxed employment income and get some of the PAYE back.
Obviously, whether you have any additional tax and NI liabilities arising from your self employed activity will depend on how prifitable the business has been in the 2007/08 tax year.
Don't forget that the Revenue's definition of "profit" may be different from what you expect and that you will be allowed deduct normal day to day business expenses plus Capital Allowances from your overall business income before you arrive at a taxable profit. Indeed, sometimes, by the time all the business allowances have been taken into account, you might arrive at a tax deductable loss. If that actually happens, you can offset the loss against your already taxed employment income and get some of the PAYE back.
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