Small business bookkeeping obligations
Failure to keep records can result in a fine and disqualification as a Company Director so it is important to understand your obligations.
According to the Companies Act, all companies must keep “true and fair” financial and accounting records for at least 6 years and in some cases longer such as if a transaction covers more than one year’s accounting period or if you have bought something that is expected to last longer than 6 years like equipment or machinery.
Receipts and invoices detailing all money sent and received by the company must be kept as well as details of all assets owned and any debts the company owes or is owed.
Details of stock owned at the end of the financial year and the stocktakings used to work this out must always be available and details of all goods bought and sold throughout the year and, unless you are running a retail business, you will also have to keep a log of who you bought and sold to and from.
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According to the Companies House, every company must keep accounting records - whether they are trading, or not.
Accounting records must include:
entries showing all money received and expended by the company
a record of the assets and liabilities of the company
Also, if your company’s business involves dealing in goods, the records must include:
statements of stock held by the company at the end of each financial year
all statements of stock takings from which you have taken or prepared any statements of stock
statements of all goods sold and purchased, other than by ordinary retail trade. This should list the goods, the buyers and sellers
Parent companies must ensure that any subsidiary undertaking keeps sufficient accounting records so that the directors of the parent company can prepare accounts that comply with the Companies Act or UK-adopted International Accounting Standards.
Even a well-run business can fail due to a lack of funds or resources during a financial crisis or recession.
Budget forecasts and business viability are possible with a well-defined plan or strategy and clear goals. Financial forecasts can predict your company's future, allowing you to monitor your finances and address potential issues early.
We are here to help you prepare projected profit and loss accounts and balance sheets, identify any performance differences, explain how and why they occurred, and help you protect your finances and plan for a prosperous future.
Value Added Tax (VAT) is the tax you must pay when buying goods or services. If you are a business, you may be required to register for and collect VAT.
Businesses with a turnover of more than £85,000 (known as VAT registration threshold) must register to pay and add VAT on the products and services they buy and sell and pay this to HMRC when they file their quarterly return.
VAT in the UK is typically charged at:
20% on goods and services
5% is applied to some health, energy, heating, and protective products and services.
0% is applied to a range of products and services to do with health, building, publishing, and kids’ clothing.
Some services and sales of goods are outside the scope of VAT (like stamps, and financial and property transactions). Instead, businesses charge VAT based on what they sell and how much money they make.
Your dedicated accounting manager will handle all your VAT issues. They will assess your company's tax efficiency and advise you to switch if necessary.
You will be registered for the appropriate VAT scheme, managed the registration process, and keep you informed of new laws and regulations.
Contact us for complete peace of mind. so you can run and grow your company!
Payroll is not straightforward and the penalties for non-compliance are high.
If you employ staff, you have to arrange for their salaries, and bonuses and commissions to be paid at the end of the week or month or year. You also have to deal with sick pay, maternity pay, student loans and incentives like Child Tax Credits and so on.
This means that you need to be familiar with all the current laws and tax rules so that you do not overpay your staff for obvious reasons, but also do not underpay your staff so that they do not take you to court for an unlawful deduction of wages.
Employing such a specialised staff member who is up to date on all the current rules can be costly and time-consuming especially now with RTI in place requiring submissions of PAYE on a real-time basis.
Taking the headache out of your payroll issues.