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Preparing your bookkeeping for April changes

Mon, 30 Mar 2026 11:16:54 GMT

Preparing your bookkeeping for April changes!

As April approaches, many small business owners start to feel a bit more pressure around their bookkeeping and tax responsibilities. This is usually because changes to reporting requirements and processes tend to take effect at the start of the new tax year.

For most businesses, the stress doesn’t come from the changes themselves — it comes from not feeling fully prepared.

Taking a bit of time in March to get your bookkeeping organised can make a big difference to how smoothly the months ahead run.

Why March is an important month

March is a natural checkpoint. It gives you the chance to look at how your records are being kept and whether anything needs attention before April arrives.

Leaving everything until later can lead to:

 rushing to update records

 uncertainty around figures

 increased pressure once new requirements apply

 more time spent correcting issues

Getting things in order before April helps avoid these problems and gives you more

confidence going forward.

An added pressure for some sole traders

For some sole traders, April brings an extra layer of pressure.

Those included in the first phase of Making Tax Digital for Income Tax will still need to complete a tax return for the year ending 5 April 2026, while also starting to keep their records more regularly to meet the new compliance rules.

Managing both at the same time can feel like a lot, especially when bookkeeping is squeezed in around day-to-day work. This is why getting organised early and spreading the workload makes such a difference.

What being prepared actually looks like

Preparing your bookkeeping doesn’t need to be complicated. In most cases, it simply means making sure your records are accurate, complete, and up to date.

This may involve:

 checking that income and expenses are recorded correctly

 making sure bank accounts are reconciled

 reviewing outstanding invoices or missing information

 ensuring records are being kept regularly, not just at deadline time

When these basics are in place, any changes that come into effect in April are much

easier to manage.

Common issues that come up in March

March is often when business owners realise:

 some records haven’t been updated for a while

 personal expenses paid for the business haven’t been included

 information is missing or unclear

 they’re unsure whether their current systems are suitable

These issues are very common and usually straightforward to deal with when spotted

early.

How regular bookkeeping makes the transition easier

Regular bookkeeping spreads the work evenly throughout the year instead of letting it build up.

When records are kept up to date:

 figures are clearer

 there’s less pressure around deadlines

 changes to requirements feel more manageable

 there are fewer surprises

 accountants ask fewer questions during the yearend process

This makes the move into April far calmer than trying to catch up at the last minute.

When professional support can help

Many business owners manage their own bookkeeping successfully for a while, but as businesses grow or requirements change, it becomes harder to stay on top of everything — especially when bookkeeping is fitted in around client work and admin.

Professional support can help by:

 keeping records consistently up to date

 identifying issues early

 planning for deadlines instead of reacting to them

 providing reassurance and clarity

 keeping in regular contact about your financial records

Having support in place before April often saves time and stress later on.

In summary

March is the ideal time to review your bookkeeping and make sure everything is ready for April. Keeping records organised and up to date makes changes easier to manage and reduces pressure as the new tax year begins.

If you’d like to understand how ongoing bookkeeping support could help you prepare

for April and beyond, you can find out more on our website.

Making Tax Digital: What small businesses need to understand now!

Mon, 30 Mar 2026 10:05:32 GMT

Making Tax Digital: what small businesses need to understand now!

Making Tax Digital (MTD) is one of the biggest changes to how tax information is recorded and reported, yet many small business owners are still unsure how it will affect them or what they actually need to do.

For some, it feels confusing. For others, it’s something they know is coming but haven’t had the time to look into properly. The important thing to understand is that MTD isn’t just about submitting returns — it changes how records are kept throughout the year.

Getting to grips with the basics early makes the whole transition much easier.

What Making Tax Digital is really about

MTD requires businesses to keep their records digitally and submit information to HMRC using compatible software.

That part is fairly straightforward. The bigger change is the shift away from occasional or lastminute bookkeeping towards keeping records up to date on an ongoing basis.

A lot of people are used to gathering everything at the end of the year and handing it to their accountant in December, just before the 31 January deadline. MTD is designed to move businesses away from that “once a year” approach and towards more regular recordkeeping.

Why recordkeeping matters more under MTD

Under MTD, accurate and up-to-date records become even more important. When bookkeeping is left too long, businesses often find themselves:

 scrambling to update months of information

 unsure whether the figures are right

 under pressure as deadlines get closer

 more likely to make mistakes

Keeping things up to date throughout the year avoids these problems and makes compliance much easier to manage.

Common misunderstandings about MTD

There are still a few misconceptions about Making Tax Digital, such as:

 thinking it only affects large businesses

 assuming it only matters at the point of submission

 believing that software alone will solve everything

In reality, MTD affects many small businesses and focuses heavily on how information is recorded and reviewed throughout the year — not just when a return is due.

Why preparing early makes a difference

Preparing for MTD early gives businesses time to:

 understand what’s required

 put the right systems in place

 build consistent bookkeeping habits

 reduce pressure as deadlines approach

Leaving it until the last minute usually leads to unnecessary stress, especially when

you’re already busy with daytoday work.

How regular bookkeeping supports MTD compliance

Regular bookkeeping plays a big part in meeting MTD requirements. Keeping records up to date:

 makes it easier to meet digital recordkeeping rules

 reduces lastminute work

 improves confidence in the figures

 helps keep everything organised throughout the year

For many businesses, ongoing bookkeeping support makes compliance far more

manageable.

When professional support can help

As rules change, many business owners find that what once worked no longer feels sustainable — especially when bookkeeping is squeezed in around client work and admin.

Professional support can help by:

 keeping records consistently up to date

 planning for deadlines instead of rushing

 providing clarity around what’s required

 offering reassurance when things feel unclear

Regular support is usually more costeffective — and far less stressful — than repeated

catchup work or fixing issues later on.

In summary

Making Tax Digital is about more than submitting information digitally — it’s about keeping accurate, up-to-date records throughout the year.

Understanding what MTD involves, and preparing early, makes the process far less stressful and helps businesses stay compliant with confidence.

If you’d like to learn more about how MTD may affect your business, or how regular bookkeeping can help, you can find more information on our website.

Why Regular Bookkeeping Makes TAX Deadlines Easier!

Sat, 31 Jan 2026 16:34:44 GMT

Why regular bookkeeping makes tax deadlines easier

A lot of small business owners only think about bookkeeping when a deadline is suddenly right in front of them — a VAT return is due, a CIS submission needs doing, or the accountant asks for information. That’s usually when everything feels urgent and stressful.

Most of that pressure doesn’t come from the deadline itself. It comes from leaving the

bookkeeping too late.

Keeping things up to date throughout the year makes every deadline far easier to deal

with.

What Regular Bookkeeping actually Means

Regular bookkeeping just means keeping on top of things as you go, instead of trying to sort months’ worth of information in one go. That might be weekly or monthly — whatever works for your business.

It usually involves checking transactions, making sure figures look right, and keeping records complete. When this is done regularly, there’s far less to worry about when a deadline comes around.

Why lastminute bookkeeping causes problems

Leaving everything until the last minute often leads to:

 hunting for missing invoices or receipts

 trying to remember what certain transactions were for

 more errors

 higher stress

 extra time spent fixing things

 missed expenses, especially if they were paid from a personal account

It can also cost more, because sorting through months of information in one go takes

longer than keeping on top of it steadily.

How regular bookkeeping helps with tax dea dlines

Up-to-date records make a big difference with:

 VAT returns

 CIS submissions

 yearend accounts

 Making Tax Digital requirements

When everything is already organised, deadlines become routine rather than stressful. There are fewer surprises, fewer lastminute questions, and more confidence that the figures are right.

Better visibility throughout the year

Regular bookkeeping doesn’t just help with deadlines — it also gives you a clearer picture of how your business is doing.

When your records are up to date, you can:

 see how things look month by month

 spot issues early

 make better decisions

 avoid unexpected tax bills

This ongoing visibility is often more useful than trying to fix problems after they’ve built up.

When professional support can help

Many business owners start out doing their own bookkeeping, but as things get busier, it becomes harder to keep everything organised — especially when you’re doing client work as well as your own admin.

Professional support can help by:

 keeping records up to date

 planning for deadlines instead of rushing

 making compliance easier

 giving you someone to ask when you’re unsure

Regular support is usually far more costeffective — and far less stressful — than

repeated catchup work.

In summary

Deadlines don’t have to be stressful. Most of the pressure comes from leaving bookkeeping until the last minute, not from the deadline itself.

Keeping things up to date spreads the work out, keeps your records clear, and makes compliance much easier throughout the year.

If you’d like to understand how ongoing bookkeeping support could help your business, you can find out more on our website.

What we can do for you in 2026

Tue, 30 Dec 2025 22:05:48 GMT

Happy New Year & Thank you for your continued support

As we step into 2026, we want to take a moment to say thank you to all our clients for your continued trust and support over the past year. Whether you’ve been with us for many years or joined us more recently, we truly appreciate the opportunity to support your business and be part of your journey.

Running a business isn’t always easy, and we know how much time, effort, and dedication goes into keeping everything moving. We’re proud to have helped so many of you stay compliant, organised, and in control of your finances throughout 2025 and we’re grateful for every recommendation, kind message, and ongoing partnership along the way.

Looking Ahead to 2026

As we move into 2026, our focus remains the same: taking the stress out of your bookkeeping and helping you stay one step ahead of HMRC . We’ll continue to support you with clear, jargon-free bookkeeping, VAT returns, payroll, CIS, and tax returns, making sure deadlines are met and your records are accurate and up to date.

With ongoing changes such as Making Tax Digital and increasing compliance requirements, having reliable bookkeeping support has never been more important. In 2026, we’ll be here to help you stay digital-ready, avoid penalties, improve cash flow visibility, and free up more of your time so you can focus on running and growing your business.

Thank you again for choosing Books & Business . We look forward to supporting you throughout 2026 and beyond. Wishing you a successful, healthy, and prosperous New Year.

VAT Returns Made Easy: Avoiding Mistakes & Penalties

Thu, 20 Nov 2025 12:59:25 GMT

VAT doesn’t have to be stressful. But with tighter HMRC rules and full MTD for VAT now in place, mistakes can lead to penalties, overpayments, or missed claims. Here are the key things to watch out for.

Common VAT Mistakes to Avoid

1. Late Filing & Payments

The most common (and costly) error, late returns trigger interest and penalties.
Fix it: Keep bookkeeping updated monthly so the quarter-end isn’t a panic.

2. Missing Input VAT

Fuel, tools, materials, subscriptions, supplier invoices. If you are missing any of these it means you overpay VAT.
Fix it: Capture receipts digitally as you go.

3. Claiming VAT You Shouldn’t

Personal purchases, invalid invoices, or VAT from non-registered suppliers can all cause HMRC issues.
Fix it: Always check invoices include valid VAT numbers.

4. Being on the Wrong VAT Scheme

Flat Rate, Cash Accounting, Standard…. being on the wrong one can cost you.
Fix it: Review your scheme regularly.

MTD VAT: Staying Compliant

HMRC now requires:

Digital records
Software-based submissions
No manual data copying

If your system isn’t fully digital, you risk penalties even if the numbers are correct.

Why Monthly Bookkeeping Helps

Regular bookkeeping means:

Accurate, digital records
No lost receipts
Fewer mistakes
Smoother quarter-end VAT
On-time submissions every time

Need help with VAT?

We support businesses with monthly bookkeeping that keeps VAT accurate, compliant, and stress-free.

MTD ITSA: What Sole Traders & Landlords need to know for 2026

Fri, 24 Oct 2025 16:46:23 GMT

Making Tax Digital (MTD) for Income Tax Self Assessment (ITSA)

MTD is one of the biggest changes coming to the UK tax system and it’s just around the corner.

From April 2026, many sole traders and landlords will need to keep digital records and send quarterly updates to HMRC using MTD-compatible software.

If your income comes from self-employment or property, now’s the time to understand what’s changing and how to prepare.

What’s changing from April 2026?

Under MTD for Income Tax , you’ll no longer send a single Self Assessment tax return once a year.

Instead, you’ll need to:

Keep digital records of your income and expenses
Send quarterly updates to HMRC using approved software
Submit an end-of-year final declaration confirming your income

This change aims to make tax reporting more accurate, more frequent, and less reliant on paper or manual entries.

Who will need to comply first?

MTD ITSA is being introduced in two stages:

From April 2026: Sole traders and landlords with a total income of £50,000 or more (from self-employment and property combined) must join MTD.
From April 2027: Those earning £30,000 or more will need to follow suit.

If your income is below £30,000, MTD won’t apply yet but it’s still worth getting digital systems in place early.

Why spreadsheets alone won’t be enough

Under MTD, your figures must flow digitally from your records to HMRC. That means you can’t simply copy and paste numbers from a spreadsheet you’ll need MTD-compliant bookkeeping software that can link directly to HMRC and submit your quarterly updates automatically. This digital connection ensures your data is accurate and reduces the risk of errors or missed deadlines.

How to prepare for MTD ITSA now

Getting ready early can save a lot of stress later. Here’s how to start:

✅ Review your record-keeping:
If you’re still using paper records or Excel, consider moving to a digital bookkeeping system now.

✅ Choose MTD-compliant software:
There are plenty of options — and we can help you choose the one that fits your business best.

✅ Organise your income sources:
HMRC looks at combined income from self-employment and property, so make sure you know your total.

✅ Get professional support:
Working with a bookkeeper experienced in MTD means you’ll have everything set up correctly from the start.

Avoid the 2026 rush get digital-ready now!

MTD might feel like a big change, but with the right support, it can make your finances smoother, clearer, and more efficient.

At Books & Business, we help sole traders, landlords, and small business owners set up digital bookkeeping systems that meet MTD requirements so you’re fully compliant before the April 2026 deadline.

How the Bank of England’s rate cut could impact your construction or trade business

Fri, 22 Aug 2025 16:40:14 GMT

The Bank of England has reduced the base rate to 4% , the lowest since 2023. While most headlines focus on mortgages and savings, this decision has a big impact on trades and construction businesses too. From borrowing costs to cash flow, here’s what it means for your business.

Cheaper Borrowing for Business Growth

Lower interest rates mean reduced costs for loans, hire purchase, and finance agreements. For builders, electricians, plumbers, and other trades, this could make it more affordable to:

Finance a new van or company vehicle
Invest in tools, machinery, or equipment upgrades
Expand your workshop or office space
Take on larger contracts with upfront costs

Even a small drop in repayments can improve cash flow, giving your business more breathing room.

Relief on Existing Business Debt

If your business already has a variable-rate loan, overdraft, or finance agreement , you may notice lower repayments straight away. This could save your construction or trade business hundreds of pounds a year, money that can be reinvested into staff, materials, or marketing.

More Demand for Construction and Trade Services

Lower interest rates don’t just help businesses, they also boost consumer confidence . With households feeling more secure in their finances, many will be more willing to spend on home improvements, extensions, and renovations. This creates new opportunities for builders, roofers, joiners, and subcontractors across the construction industry.

But Inflation still matters

It’s important to remember that inflation is still running above the Bank of England’s target. For trades and construction businesses, that means material costs, fuel, and supplier prices remain high . Even with cheaper borrowing, keeping a close eye on quotes and project costs is essential to protect your profit margins.

What you can do next

Here are some practical steps for construction and trade businesses following the rate cut:

Review your finance agreements – check if your loan or overdraft repayments will fall.
Plan for investment – if you’ve been holding off on buying equipment, now may be the time.
Monitor cash flow closely – strong bookkeeping helps you make informed decisions and spot risks early.
Build inflation into quotes – don’t get caught out by rising material prices.

If you’d like support with bookkeeping, cash flow planning, or financial strategy , we’re here to help

MTD for Income Tax: What trades and construction businesses need to know

Wed, 30 Jul 2025 16:47:13 GMT

If you're a sole trader or landlord earning over £50,000 a year, big changes are coming your way. From April 2026, you'll need to comply with Making Tax Digital for Income Tax (MTD for ITSA) and while that might sound like it's a long way off, it’s closer than it seems.

At Books and Business, we work closely with those in the trades and construction sector, and we know that admin is rarely top of the to-do list when you're running jobs, managing quotes, and keeping customers happy. But this change will affect how you keep records and report your income, so starting early is key.

Lets get into what MTD for ITSA means for your business and more importantly how we can support you every step of the way.

What’s Changing?

Under MTD, if your income is over £50,000, you’ll need to:

Keep digital records
Submit quarterly updates to HMRC using MTD-compatible software
File a final year-end statement alongside your usual return

And that’s just the start, the income threshold will drop to £30,000 in April 2027, meaning even more sole traders will be brought into the fold.

How does this affect you?

Let’s be honest, this adds another layer to the already time-consuming admin. If you’re currently filing a Self Assessment once a year, you'll now be reporting four times a year plus a final return. That’s a big shift, especially if you’re used to doing things manually or handing it all over once a year.

But there’s a silver lining: the right digital tools (and a good bookkeeper) can make the transition much smoother and even help you work more efficiently.

Our advice to get ahead

Go Digital Sooner Rather Than Later!

Start using digital invoicing, receipt capture apps, and MTD-compatible software now. It’ll help reduce errors, save time, and improve your cash flow.

Don’t go it alone

We’re already helping trades and construction clients get ready for MTD, from choosing the right software to setting up processes that work for them. You don’t need to become a tax expert overnight as we’ve got you covered.

Stay informed

HMRC is releasing more details as the deadline approaches, and we’ll keep you updated with the important bits.

Bottom line

MTD is coming and it’s not going away. But getting ready doesn’t have to be stressful or expensive. We’re here to help you prepare in a way that fits around your business, saves you time, and avoids any last-minute scrambles.

Want to know if your current setup is MTD ready? Give us a call, we can help streamline your processes. Get in touch today and let’s get ahead of the change.

How to choose the best accounting software for MTD

Sun, 22 Jun 2025 17:08:07 GMT

Making Tax Digital for Income Tax Self-Assessment (MTD ITSA) is coming, now is the time to get prepared!

Whether you're a sole trader, subcontractor, or running a small limited company, choosing the right accounting software will keep you compliant and help you stay in control of your finances. But with so many options out there, how do you choose the best MTD software for your business? Here are some key features to look for:

HMRC Compatibility

The most important feature is that the software you choose is MTD compliant. It should link directly with HMRC so you can send updates digitally as well as meet other MTD obligations.

Ease of Use

Your time is best spent on-site, not buried in admin. Choose software that’s straightforward and suits your level of accounting knowledge. Look for mobile apps and dashboards that give you access on the go.

Automation & Reporting

The best systems will save you time by automating recurring tasks, like invoicing, expense tracking, and mileage logs as well as offering clear reports to help you understand where your money's going.

Pricing & Scalability

Think about where your business is headed. Can the software grow with you? Choose a platform that fits your budget now, but also supports features like payroll, CIS returns, or multiple users down the line.

What are the most popular software options:

QuickBooks – A popular option for trades and small business owners, offering strong mobile tools and CIS features.
Xero – Great for real-time visibility, simple bank feeds, and job costing add-ons.
FreeAgent – Perfect for sole traders and subcontractors, especially those who like things kept simple.
Sage – Well-established and ideal if you’re looking for a more traditional setup with solid support.

You’ve chosen the software but why make the switch now

If you’re still using spreadsheets or a paper-based system, we cannot stress enough that now is the time to go digital . Getting ahead of the MTD deadlines gives you time to learn the software, avoid penalties, and work out any teething problems before submissions are mandatory.

A quick note to be aware ...... some banks now include accounting software when you open a new business account. However, it’s advisable to do your research first to ensure the software they are offering meets your business needs.

We can help with your MTD journey; we offer a variety of packages to suit each individual’s needs, from basic set up to regular training or just ad hoc training on any areas you may be getting stuck with, we also offer full packages where we can do it all for you. Get in touch for more information.

Homebuyers in Stamp Duty Sprint Before April Hike

Thu, 20 Feb 2025 15:45:32 GMT

With the 1st April deadline looming, its reported that 550,000 homebuyers are racing to complete purchases before stamp duty jumps back to its 2022 levels.

We have read that sales awaiting completion are up 25% from last year, with an average five-month wait putting pressure on buyers to beat the deadline.

Currently, first-time buyers pay no stamp duty on homes up to £425,000 when purchasing a property worth up to £625,000, but from 1 ^st April, that drops to £300,000. The upper limit will also fall from £625,000 to £500,000.

It's not just the first-time buyers taking a hit, currently stamp duty is only owed on amounts over £250,000, however from 1 ^st April, only the first £125,000 will be exempt.

Despite the cost increase, it looks like most buyers are still pressing ahead, with some even renegotiating offers to offset the hike.

According to our research, regardless of the impending cost increases, property experts such as Rightmove are predicting the demand to stay strong; especially if interest rates continue to fall. With mortgage rates already dipping below 4%, we believe buyers remain hopeful for a more affordable market ahead.

Top Tips for Completing Your Tax Return

Sun, 26 Jan 2025 13:56:16 GMT

A new year often comes with two things: broken resolutions and the stress of meeting the self-assessment tax return deadline by 31st January. If you’re feeling overwhelmed, these tips will help you avoid common pitfalls and ensure a smoother process.

Register Early

Don’t wait until the last minute to register for self-assessment. HMRC’s login credentials can take days to arrive. Planning ahead avoids delays and potential penalties.

Know Your Deadlines

Online tax returns must be submitted by 31st January, while paper returns were due by 31st October. Missing these deadlines could result in fines and added interest.

Declare All Income

Make a comprehensive list of all income streams, including:

Self-employment
Rental income
Investment returns
Foreign income
Side hustles or freelance work
Interest on savings and dividends

Report Crypto Gains

HMRC is cracking down on undisclosed cryptocurrency gains. If you made a profit from crypto in the past year, ensure it’s included in your return to meet capital gains tax obligations.

Take Advantage of Tax Reliefs

Don’t miss out on valuable tax savings, such as:

Pension contributions
Gift Aid donations
Eligible business expenses like office supplies, travel costs, and professional fees

Keep detailed records throughout the year to ensure all claimable expenses are included.

Plan for Payments on Account

If your tax bill exceeds £1,000, you’ll need to make advance payments towards next year’s bill. Be prepared to factor this into your budgeting.

Save for Your Tax Bill

Set aside around 25% of your income to cover tax and National Insurance contributions. This prevents a scramble for funds when the bill arrives.

Keep Accurate Records

Use accounting software to log income and expenses in real time. Reconciling accounts monthly or quarterly reduces stress and ensures no deductions are missed.

Don’t Hesitate to Seek Help

Tax returns can be complex, especially with changing thresholds and new rules. A reputable bookkeeper or accountant can save time, reduce errors, and offer peace of mind.

Final Advice

The key to a successful self-assessment is preparation. Track your finances year-round, stay organised, and seek support if needed. By planning ahead, you’ll avoid surprises and make the process as seamless as possible.

HMRC’s Online Resources

If you’re planning to complete your Self Assessment tax return yourself, HMRC provides a comprehensive collection of online resources. These include videos and factsheets to guide you through the process, detailed instructions for registering or deregistering for Self Assessment, and a digital assistant to address specific queries. You can access these resources at HMRC’s official page .

Christmas Opening Hours 2024

Tue, 17 Dec 2024 18:50:08 GMT

We'd like to take this opportunity to thank all our clients and wish them a very Merry Christmas and a Happy and Prosperous New Year.

We are closed from Wednesday 18th December 2024 for the Christmas break. We will be re-opening on Monday 30th December 2024.

Please send any queries to our email admin@booksandbusiness.co.uk and will get back to you as soon as we can.

Plans for ID verification from Companies House

Tue, 22 Oct 2024 12:14:01 GMT

Starting in early 2025, Companies House will begin rolling out new identity verification requirements for company directors and persons with significant control (PSCs). This means that, in the future, before filing information on the Companies House register, directors will need to prove their identity. This change is designed to reduce fraud and improve transparency.

The reforms are part of the Economic Crime and Corporate Transparency Act 2023, which aims to combat fraudulent activity. As part of these reforms, accountancy firms and solicitors registered for anti-money laundering (AML) supervision will be among the first required to comply, starting in early 2025.

By spring 2025, accountants and other professional service providers, who are registered for AML supervision, will be able to become authorised corporate service providers (ACSPs). This means they’ll be able to help clients verify their identities and pass that information on to Companies House.

By autumn 2025, these new ID verification requirements will be mandatory for new directors and PSCs when setting up a company or making new appointments.

If your business already exists, you will have a 12-month transition period until autumn 2026 to ensure your directors and PSCs comply with these requirements when your next confirmation statement is due.

This is a significant change, therefore it’s important to stay ahead of these requirements to avoid any disruptions to your business.

Reminder: No Change to Tax Rules for Selling Personal Items on Online Marketplaces

Thu, 26 Sep 2024 16:23:59 GMT

S elling your used clothes or old furniture online? No need to worry about HMRC!

With the rise of online marketplaces, many people are taking the opportunity to sell unwanted personal items, such as used clothes or old furniture. Recently, there have been some rumors circulating that HMRC is cracking down on people who sell in this way, potentially classifying these sales as a side hustle.

However, we want to remind everyone that there has been no change in the tax rules for selling your personal possessions.

Key Points to Remember:

Selling personal items like used clothes, old furniture, or household goods does not constitute a business activity. HMRC does not tax individuals on the sale of personal items as long as they are not sold with the intent to make a profit or operate as a business.
HMRC is not classifying casual sellers as "side hustlers". If you’re simply getting rid of unwanted items, you don’t need to worry about being taxed on these transactions.
Business vs. Personal Sales: The distinction lies in whether you are trading goods regularly with the aim of making a profit. If you’re selling your possessions to declutter or for other personal reasons, this is not considered a business, and no tax is due.

What Does Count as a Business?

If you’re buying items specifically to sell them for a profit, running a store, or regularly selling in bulk on online platforms, then you may be classed as trading. In this case, income from these activities may be taxable, and it’s important to keep accurate records.

But for most people just looking to sell their old clothes or used furniture, there’s no need to worry. HMRC is not clamping down on casual sellers, and you won’t be taxed on sales of personal possessions.

Stay informed and make sure you understand the rules—but rest assured, nothing has changed when it comes to selling your own personal items online.

Simplifying bookkeeping during the summer holidays

Fri, 23 Aug 2024 10:10:38 GMT

The summer holiday season often brings a welcome break from the daily grind, but for small business owners, it can also create challenges in maintaining consistent bookkeeping practices. Balancing leisure with financial management is crucial to ensure your business remains on track. Here are some tips to make your bookkeeping easier during the summer holiday period:

1. Automate Where Possible

Automation is your best friend during busy or relaxed times. Use accounting software like QuickBooks, Xero, or Sage to automate recurring tasks such as invoicing, payroll, and expense tracking. Setting up bank feeds can also automatically import and categorise transactions, reducing manual input and errors.

2. Plan Ahead

Before your holiday kicks off, take some time to plan your finances. Schedule payments and set reminders for important deadlines like VAT returns or payroll submissions. Preparing in advance ensures that nothing slips through the cracks while you're enjoying your time off.

3. Delegate Tasks

If you have a team, consider delegating some of the routine bookkeeping tasks. Training a trusted employee or hiring a part-time bookkeeper to manage the basics can help keep your records up-to-date while you’re away.

4. Set Up a Routine

During the summer, it's easy to let bookkeeping tasks pile up. Avoid this by setting aside a specific time each week to update your books. A consistent routine will help you stay on top of things, even if you're only working a few hours.

5. Go Mobile

If you need to stay on top of your finances while on the go, ensure that your accounting software has a mobile app. Mobile bookkeeping apps allow you to manage your finances, send invoices, and check your cash flow from anywhere, making it easier to stay connected even when you're out of the office.

6. Outsource If Necessary

If the thought of managing bookkeeping during the holidays feels overwhelming, consider outsourcing it to a professional like Books and Business. Hiring an external bookkeeper can give you peace of mind, knowing that your finances are being handled by an expert while you focus on recharging.

By implementing these strategies, you can enjoy your summer holidays without compromising on your business’s financial health. Proper planning, automation, and delegation can make bookkeeping a breeze, leaving you free to relax and recharge.

We offer bespoke Bookkeeping packages including ad hoc training, please get in touch for a quote.

Key Tax Filing Dates: July – December 2024

Mon, 01 Jul 2024 13:17:10 GMT

Staying on top of tax deadlines is crucial for effective business management and compliance. Here’s a summary of essential dates and deadlines from July to December 2024 for various tax filings and payments to HMRC.

July 2024

1st July: Corporation Tax due for companies with September year-ends.
5th July: PAYE Settlement Agreement (PSA) deadline for 2023-24.
6th July: P11D, P11D(b), and Employment Related Security (ERS) Returns deadline.
7th July: Electronic VAT payments and returns due.
19th July: June PAYE and Class 1 NIC postal payments, CIS returns due.
22nd July: June PAYE and Class 1 NIC electronic payments due.
31st July: Self-Assessment second payment on account, Corporation Tax Returns for July year-ends, Tax Credits deadline, and several other deadlines for various returns and payments.

August 2024

1st August: Corporation Tax due for companies with October year-ends.
7th August: Electronic VAT payments and returns due.
19th August: July PAYE and Class 1 NIC postal payments, CIS returns due.
22nd August: July PAYE and Class 1 NIC electronic payments due.
31st August: Corporation Tax Returns for August year-ends due.

September 2024

1st September: Corporation Tax due for companies with November year-ends.
7th September: Electronic VAT payments and returns due.
19th September: August PAYE and Class 1 NIC postal payments, CIS returns due.
22nd September: August PAYE and Class 1 NIC electronic payments due.
30th September: Corporation Tax Returns for September year-ends due.

October 2024

1st October: Corporation Tax due for companies with December year-ends.
5th October: Deadline to register for Self-Assessment for 2023-24.
7th October: Electronic VAT payments and returns due.
19th October: September PAYE and Class 1 NIC postal payments, CIS returns due.
22nd October: September PAYE and Class 1 NIC electronic payments due.
31st October: Paper Self-Assessment tax returns for 2023-24, Corporation Tax Returns for October year-ends due.

November 2024

1st November: Corporation Tax due for companies with January year-ends.
7th November: Electronic VAT payments and returns due.
19th November: October PAYE and Class 1 NIC postal payments, CIS returns due.
22nd November: October PAYE and Class 1 NIC electronic payments due.
30th November: Corporation Tax Returns for November year-ends due.

December 2024

1st December: Corporation Tax due for companies with February year-ends.
7th December: Electronic VAT payments and returns due.
19th December: November PAYE and Class 1 NIC postal payments, CIS returns due.
22nd December: November PAYE and Class 1 NIC electronic payments due.
31st December: Self-Assessment online tax return deadline for those wanting HMRC to collect tax owed from wages and pensions, Corporation Tax Returns for December year-ends due.

Additional Key Deadlines

5th July: Non-resident landlords scheme annual information return.
14th July & 14th of Each Month: Corporation tax instalment payments due for various large and very large companies.
30th of Each Month: Returns and payments due by tenants and agents for rents to non-resident landlords.

Stay aware of these dates to ensure timely and accurate compliance with HMRC requirements.

Streamline your Business with Professional Bookkeeping Services

Wed, 26 Jun 2024 05:47:15 GMT

Running a small business is no small feat. From managing daily operations to strategising for growth, the demands on your time and resources are immense. Amidst all of that, bookkeeping can perhaps feel like daunting tasks that eat into your productivity. This is where we at Books and Business come in – as your dedicated bookkeeper, committed to transforming your financial management and ensuring your business thrives.

Why Choose Professional Bookkeeping Services?

1 . Accuracy and Compliance

Bookkeeping is the backbone of your business’s financial health. Accurate records are crucial for making informed decisions and ensuring compliance with tax regulations. Our expertise in bookkeeping ensures that every transaction is recorded meticulously, financial statements are prepared accurately, and your business remains compliant with all relevant laws and regulations.

2. Time-Saving

Time is one of your most valuable assets as a small business owner. By outsourcing your bookkeeping tasks to a professional, you free up significant time to focus on what you do best – growing your business. Let us handle the numbers while you concentrate on the rest of your business.

3. Financial Insights

Understanding your financial position is key to making strategic business decisions. We can provide detailed financial reports and insights that help you track your business’s performance, identify trends, and make informed decisions. Whether it’s budgeting, forecasting, or identifying cost-saving opportunities, we are here to provide the financial clarity you need.

Customised Services for Your Unique Needs

Every business is unique, and so are its financial management needs. We offer tailored bookkeeping services that are designed to meet the specific requirements of your business. Here’s what you can expect from Books and Business:

Comprehensive Bookkeeping Services:

- Accurate recording of all financial transactions

- Preparation of financial statements (income statements, balance sheets, cash flow statements)

- Bank reconciliations

- Accounts payable and receivable management

- Expense tracking and management

Partner with us for Success

Choosing to work with a professional bookkeeper means investing in the future success of your business. With our expertise, dedication, and personalised approach, you can achieve greater financial clarity, compliance, and efficiency. Let’s work together to streamline your financial processes and set your business on the path to sustained growth and success.

Ready to take the next step? Contact us today to schedule a consultation and discover how our bookkeeping services can benefit your business. Together, we can build a solid financial foundation that supports your business ambitions. Click to get in touch

The Importance of Categorising Business Expenses

Wed, 22 May 2024 16:34:35 GMT

The Importance of Categorising Business Expenses: Insights from a Bookkeeper

As a bookkeeper, one of the most crucial tasks I perform for my clients is the meticulous categorisation of their business expenses. This might seem like a mundane and tedious task, but in reality, it is a cornerstone of effective financial management. Let me walk you through why categorising business expenses is so important and how it can benefit your business in multiple ways:

1. Accurate Financial Reporting

Categorising expenses accurately allows for clear and precise financial reports. These reports are essential for understanding the financial health of your business. When expenses are properly categorised, you can quickly see where your money is going, which helps in identifying trends, managing budgets, and making informed financial decisions. For instance, you might notice that your marketing expenses are higher than usual or that your office supplies budget needs adjustment. Without proper categorisation, these insights would be much harder to spot.

2. Simplified Tax Preparation

Tax season can be a daunting time for many business owners, but proper expense categorisation can significantly simplify this process. By categorising expenses throughout the year, you ensure that you have all the necessary information at your fingertips come tax time. This not only saves time and reduces stress but also helps in maximising your tax deductions and minimising the risk of errors.

3. Improved Budget Management

A well-maintained expense categorisation system helps in effective budget management. When you categorise expenses, you can set more accurate budgets for different areas of your business. This helps in controlling costs and ensuring that funds are allocated appropriately. For example, if you have a clear view of how much you spend on travel, you can set a realistic travel budget and avoid overspending.

4. Enhanced Financial Analysis

Categorised expenses enable more detailed and insightful financial analysis. This analysis can highlight areas where the business is performing well and areas that need improvement. For instance, you might discover that a particular product line is more profitable because you can accurately track all related expenses. This detailed level of analysis is impossible without proper categorisation.

5. Better Cash Flow Management

Cash flow is the lifeblood of any business. By categorising expenses, you can monitor your cash flow more effectively. You can see when and where money is being spent and plan accordingly. This foresight helps in ensuring that you always have enough cash on hand to meet your business obligations as and when they fall due.

6. Aids in Financial Planning and Forecasting

Future planning and forecasting are vital for business growth and sustainability. Categorising expenses provides a historical record that can be used to make more accurate financial forecasts and strategic plans. By analysing past spending patterns, businesses can predict future expenses and allocate resources more efficiently.

7. Supports Strategic Decision-Making

Strategic decisions require a clear understanding of your financial situation. Categorised expenses provide the detailed information necessary for making strategic decisions such as expansions, investments, and cost-cutting measures. With accurate data at hand, business owners can make informed decisions that align with their strategic goals.

To summarise, categorising business expenses is not just about keeping your books tidy — it's about gaining control over your financial destiny. It allows for accurate reporting, simplifies tax preparation, improves budget management, enhances financial analysis, facilitates better cash flow management, ensures compliance, aids in financial planning, and supports strategic decision-making. As a bookkeeper, I can confirm that businesses that prioritise proper expense categorisation are better equipped to navigate the financial complexities of running a successful enterprise. So, take the time to categorise your expenses accurately — it’s an investment in the future health of your business.

What's in store for the new tax year?

Mon, 29 Apr 2024 19:15:25 GMT

The new tax year started over 3 weeks ago with several important changes coming into effect. Here's a reminder of what has changed:

Dividend Allowance Reduction: The dividend allowance has been cut from £1,000 to £500.
Halved Capital Gains Tax Exemption: The annual exempt allowance for capital gains tax (CGT) has been halved from £6,000 to £3,000. Just two years ago, it was at £12,300, marking a significant decrease.
New CGT Rate for Property Sales: A reduced CGT rate of 24% will now apply to residential property sales, down from the usual 28% for higher-rate taxpayers. The standard 18% rate remains unchanged.
Lower Employee National Insurance Contributions (NICs): Employee NICs have been reduced by 2% to 8%, marking the second reduction since January. This will save the average worker earning £35,400 over £900 annually.
Frozen Tax Thresholds: Basic rate and higher rate tax thresholds remain frozen until 2028 at £12,570 and £50,271 respectively. This freeze is expected to push over a million taxpayers into the higher rate tax band, with no changes to the additional 45% threshold at £125,140.
Lower Self-employed Class 4 NICs: The main rate of Class 4 NIC has been reduced to 6% from 9%, along with the discontinuation of the need to pay Class 2 NICs.
Increased High Income Child Benefit Charge (HICBC): The threshold has been raised to £60,000 from £50,000, with a tapered charge for incomes between £60,000 and £80,000. Child benefit rates have also increased so the eldest child now receives £25.60 a week, all other children receive £16.95 each a week.
State Pension and Working Tax Credit Adjustments: The state pension increased to £221.20 a week, and the basic element of working tax credit rose from £2,280 to £2,435.
Changes to Private Pensions: New lump sum and death benefit allowances have been introduced, with the removal of the lifetime allowance.
Rise in ATED Charges: The annual tax on enveloped dwellings (ATED) has seen a 6.7% increase from April 1, 2024, in line with the September 2023 CPI

HALTED!! HMRC Services changes from April 24

Tue, 19 Mar 2024 21:10:34 GMT

HMRC have made a further announcement following our previous post, stating that the changes only announced yesterday regarding their phone line services are being halted , t he lines will now remain open from April - September. The original planned changes are listed in our blog below:

HMRC have today announced the trialled changes to their Self Assessment, PAYE and VAT services will be made permanent.

Rather than picking up the phone, HMRC continue to encourage all customers to go online to get help. Stating queries and transactions can all be dealt with via their online services including their app.

Here are the changes that go live from the 8th April 2024:

The Self Assessment helpline will be closed between April and September. Customers will be directed to self-serve via HMRC’s online services

The Self Assessment helpline will reopen between October and March but only to deal with priority queries – customers with queries that can be quickly and easily resolved online will again be directed to HMRC’s online services

The VAT helpline will be open for 5 days every month ahead of the deadline for filing VAT returns (one calendar month and seven days after the end of the accounting period) – outside of this time, customers will be directed to use HMRC’s online services

The PAYE helpline will no longer take calls from customers relating to refunds – customers will be directed to use HMRC’s online services

For those who need extra support for health or personal circumstances or those who cannot access online services, HMRC advisers will continue to always be available during normal office hours.

All other helplines will continue to operate as they do currently.

Spring Budget 2024 Highlights

Mon, 11 Mar 2024 20:48:17 GMT

Last week Chancellor Jeremy Hunt delivered his Spring Budget:

• Employee National Insurance sees a 2% reduction: Starting April 2024, the new NI rate will be 8%, down from the previous 10% (initially 12%).

• Further reduction in Class 4 NICs: As of April 2024, there will be an additional 2% reduction in Class 4 National Insurance contributions (originally 9%, now 6%) applied to profits ranging from £12,570 to £50,270.

• Increased High Income Child Benefit Charge threshold: Effective April 2024, the highest earning parent can now earn up to £60,000 to qualify for full child benefit, compared to the previous limit of £50,000.

• Pension lifetime allowance abolished: As of April 2024, the current £1,073,100 lifetime limit before a pension becomes taxable will be eliminated.

• Introduction of the British ISA: A new tax-free £5,000 ISA allowance for investment in UK equities is introduced from April 2024, supplementing the existing £20,000 allowance.

• Reduction in Higher Rate Capital Gains Tax: Starting April 2024, individuals earning over £50,270 will experience a 4% cut in Capital Gains Tax, decreasing from 28% to 24%.

• Scrapping of Furnished Holiday Lettings tax regime: From April 2025, landlords will no longer be allowed to deduct mortgage interest payments from their rental income.

• Withdrawal of Stamp Duty relief for multiple dwellings: Individuals looking to purchase additional properties will no longer be eligible for stamp duty relief.

• Increased VAT threshold: Effective April 2024, the threshold for small businesses to register for VAT is raised from £85,000 to £90,000.

• Frozen Alcohol and Fuel Duty: The current freeze on alcohol duty is extended until February 2025, and fuel duty cuts remain in place for another year.

Scammers pray on those waiting for tax rebates!

Fri, 23 Feb 2024 16:39:30 GMT

Getting scammed is sadly more and more common these days, but how do these scammers manage to trick unsuspecting victims!?

Our inboxes are full of emails which we can view on the go, on our mobiles, whilst juggling everything else in life. Meaning a dodgy email could potentially slip through if read when we aren’t fully concentrating, especially if we are already expecting comms from a specific source.

The self-assessment tax deadline has just passed, meaning there are many people now patiently waiting for a tax rebate. Therefore, if spoof communication were to arrive regarding said refund, it could be easily mistaken for legitimate communication from HMRC. Scammers are masters at disguise and can clone emails to look exactly like those received from HMRC including using the logo and or style of emails. The only thing a scammer can’t disguise is the email address it is sent from. They may be able to change the name but if you look into the actual email address itself, they will be unable to change this to show it has been sent from HMRC. Don’t rush when opening an email that states you are due a tax rebate, or that could be suspicious; check the @ to see if it is from HMRC and if not, do not open it, click on any links or reply with any information.

Unfortunately, it’s not just emails the scammers will use to try and get information on the premises of a tax rebate. Another way for a scammer to catch out its victim is by phone calls or text messages. Unlike emails a phone call or text can be changed to look like it is coming from HMRC meaning it could be easier to be tricked.

However, HMRC have confirmed they will not contact you via email, text or phone to ask you to request a tax rebate, or fill anything out in order to get the refund.

HMRC have stated anyone encountering suspicious comms can report them directly to them as follows:

Forward suspicious texts claiming to be from HMRC to 60599
Forward emails to phishing@hmrc.gov.uk
Report tax scam phone calls through the HMRC website on gov.uk

We are all busy and juggling what life throws at us but give anything received from HMRC an extra minute of your time to ensure it is legitimate. If you receive any suspicious comms from HMRC and you are unsure if it is real, you can check HMRC’s scams advice web page

Tax for side hustles – know the facts!

Mon, 15 Jan 2024 20:28:39 GMT

Side hustle - the word on the street - but do you know exactly what your tax liabilities are if you have one?

The current cost of living crisis has led many to start up a side hustle. With online platforms such as TikTok providing a plethora of ways to make extra money it’s no wonder brits are taking to earning extra cash where they can. However, last year HMRC announced that in January they would be cracking down on all those who have a side hustle and would be asking online platforms such as Etsy, Air B&B, eBay and Uber for example, to provide HMRC with accurate information as to how much each person is earning on these sites. Unfortunately this has led to a flurry of information online and people being unsure as to what tax is owed and where.

A side hustle is an additional job carried out on top of your normal working hours, these hours could be full or part time, but the side hustle is separate to the regular, paid hours worked in a month. It could be things such as selling clothes on Vinted, dog walking services, selling hand made cards, renting out your driveway to name just a few.

To confirm, there is no new “side hustle tax” that has been introduced by HMRC. As a UK resident, you have a £1,000 tax free ‘trading allowance’ of additional income on top of your regular employment. Meaning you can earn up to £1,000 from a side hustle before you need to consider your tax implications. The only change from HMRC is that the online platforms that facilitate the side hustles will be obligated to provide seller information and income earned to HMRC.

HMRC are not cracking down on those who sell their kids clothes, toys or their old household items online but are looking for people who make a substantial income online and do not declare it. For example, someone who has a second property and rents it out on Airbnb but does not declare the rental income.

The term trader is someone who buys goods then resells them for a higher price or someone who creates goods to sell such as crafts or jewelry, if you fall into the trader category you would need to register as self-employed. However, if you are selling your own possessions such as clothes or household items, for a lower price than you paid for them it is unlikely you are classed as a trader, even if you sell more than the 30 item limit. HMRC list examples on their website to clarify what a trader constitutes.

Therefore, if after expenses you earn less than £1,000 from your side hustle there are no new laws to state you must pay tax. There are however, new rules on reporting data, meaning the online platforms must report information on earners to HMRC from January 2024.

Christmas closure dates for 2023

Fri, 22 Dec 2023 13:45:41 GMT

Merry Christmas and Happy New Year

We'd like to take this opportunity to thank all our clients and wish them a very Merry Christmas and a Happy and Prosperous New Year.

Today, 22nd December 2023 is our last working day before we are closed for the Christmas break. We will be re-opening on Wednesday 3rd January 2024 and look forward to seeing all our clients in the new year.

Please send any queries to our email admin@booksandbusiness.co.uk and will get back to you as soon as we can.

Hit the December deadline to have your tax collected through PAYE

Mon, 18 Dec 2023 19:58:25 GMT

As the year draws to a close, it's time to wrap up loose ends, and for many, that includes filing their self-assessment tax return. While the official deadline for self-assessment tax returns is January 31st, filing by December 30th brings an added advantage for those looking for HMRC to collect their tax through their PAYE tax code. Meaning if your income tax is deducted through PAYE and you receive additional income, perhaps from a side hustle, that requires you to submit a self-assessment tax return, payment does not necessarily need to be made by 31 ^st January.

For those who prefer the convenience of spreading their tax payments throughout the year, using the PAYE system can be an excellent option. PAYE allows you to have the owed tax deducted directly from your salary, minimising the impact of a lump sum payment on 31 ^st January by simply adjusting your tax code.

In order to take advantage of this method of paying your self-employed tax, you must file your self-assessment tax return by December 30th. There are however a number of conditions in order to pay your self-assessment tax bill through PAYE:

You owe less than £3,000
Already pay tax through PAYE
Submit your self-assessment tax return by 30 ^th December

Unfortunately, you cannot pay via PAYE if you don’t have enough PAYE income in order for HMRC to collect what is owed, or if you would pay more than 50% of your PAYE income in tax, or if it would be twice as much as your usual tax amount.

An attractive arrangement for some, especially as paying by this method means the first instalment does not fall due until April 2024. The remaining instalments are split across a full year, with no interest due! Even more convenient is that if you file your self-assessment tax return by 30 ^th December and all conditions are met, HMRC will automatically amend your tax code ready to collect the tax owed from April 2024.

If you don't want HMRC to collect your tax in this way and you have been organised and filed by 30 ^th December you will need to advise them accordingly by checking the relevant box in the “finishing your tax return” section of the self assessment form.

A reminder that anyone who doesn’t submit their tax return by 31 ^st January is subject to an automatic fine from HMRC for £100.

Key points from the Autumn Statement 2023

Fri, 24 Nov 2023 18:00:48 GMT

A reminder of the Chancellors key points from the Autumn Statement 2023

Employee National Insurance Reduction: Starting January 6th, the Employee National Insurance rate will decrease by 2% to 10%, down from the previous 12%.
Self-Employed Class 2 NICs cut: Effective from April, self-employed individuals earning over £12,570 will no longer be required to pay the weekly £3.45 Class 2 National Insurance contributions.
Class 4 NICs Reduction: Commencing April, a 1% reduction in Class 4 National Insurance contributions will apply to profits ranging from £12,570 to £50,270.
National Living Wage Increase: From April, the National Living Wage will rise from £10.42 to £11.44 per hour, extending to individuals over 21 years old.
State Pensions Up: Starting April, the state pension will experience an 8.5% increase.
Universal Credit Boost: Effective April, there will be a 6.7% rise for those receiving Universal Credit.
Permanent Full Expensing Tax Break: Businesses can now permanently deduct machinery and equipment costs from their profits.
Extended Discount for Hospitality, Leisure, and Retail: The 75% business rate discount for the hospitality, leisure, and retail sectors will remain in place for an additional year.

Less than 100 days to get that self assessment tax return sorted!

Sun, 29 Oct 2023 08:41:58 GMT

Individuals who need to complete a Self Assessment tax return have less than 100 days left to submit their return to HMRC, before the deadline on January 31 st 2024.

Although some individuals leave it until the last minute, submitting your tax return ahead of the deadline allows you to determine the amount you owe and create a plan for payment before the actual due date. The tax owed from the previous tax year is due by 31 ^st January 2024 as well as your 1 ^st payment on account (if applicable).

If you are unable to make a full payment, HMRC is committed to assisting you in finding an affordable way to settle your tax debt. If your tax debt is less than £30,000, you may be eligible to establish a Time to Pay arrangement , which can be done online without the need to contact HMRC. To explore all available methods for paying your tax return, please visit ways to pay on the gov website.

If you believe that you no longer need to file a Self Assessment tax return for the 2022 to 2023 tax year, it is advisable to inform HMRC as soon as possible to avoid potential penalties.

For paper returns the deadlines are October 31, 2023, but for online returns its January 31 ^st 2024.

Filing your tax return online is the quickest and most straightforward method, see our guide to submitting your return via Quickbooks . For those who prefer paper filing, instructions on how to request a paper return can be found here . However, as we have previously reported, paper returns are no longer automatically issued, except in cases where online filing is not possible.

If you are looking for assistance with your bookkeeping and or perhaps some training with QuickBooks we offer bespoke packages to suit your needs. Get it touch for more information .

10 Cons of DIY Bookkeeping

Tue, 03 Oct 2023 19:15:03 GMT

While some small business owners may choose to handle their bookkeeping themselves to save money, there are several disadvantages associated with this approach. Here are some of the drawbacks of DIY bookkeeping:

1. Time-Consuming : Bookkeeping can be a time-consuming task, especially if you're not familiar with accounting principles and the software associated with it such as QuickBooks. Small business owners who take on bookkeeping themselves may find that they spend valuable hours on tasks that could be better used for growing their business.

2. Risk of Errors : Without a background in accounting, there's a higher risk of making errors in your financial records. These errors can lead to inaccurate financial statements, which can have serious consequences, including financial penalties, tax issues, and potential poor decision-making. Not forgetting the additional time then required to fix any errors.

3. Lack of Expertise : Bookkeepers are trained in accounting principles, tax regulations, and financial reporting. They have the expertise to handle complex financial transactions and can provide valuable insights into your business's financial health.

4. Missed Deductions and Credits : By doing your own bookkeeping you may miss out on potential tax deductions and credits that could save the business money. Accountants and bookkeepers are well-versed in tax law and can help businesses maximise their tax benefits.

5. Compliance Risks : Staying compliant with tax laws and regulations is crucial. As a business owner you may not be aware of changes in tax laws or may not fully understand compliance requirements, putting the business at risk of penalties.

6. Lack of Objectivity : Business owners who handle their own bookkeeping may have a personal bias when recording financial transactions. This subjectivity could lead to financial data that is not entirely accurate or impartial, which could affect decision-making.

7. Inefficient Processes : Business owners may not be familiar with efficient bookkeeping processes and tools, resulting in redundant or ineffective workflows. This inefficiency can waste time and potentially increase costs.

8. Limited Scalability : As your business grows, the complexity of your financial transactions and reporting requirements will likely increase. Business owners undertaking their own bookkeeping may realise it quickly becomes unsustainable as the business expands, leading to even greater challenges and errors.

9. Reduced Focus on Core Business Activities : Small business owners often wear multiple hats, but taking on bookkeeping can divert their attention from core business activities that are crucial for growth and success.

10. Higher Costs in the Long Run : While DIY bookkeeping may seem cost-effective initially, the potential for errors, compliance issues, and missed opportunities for tax savings can lead to higher costs in the long run. Bookkeepers as well as accountants can help prevent costly mistakes and optimise your financial operations saving you time and money.

While some business owners may choose to handle their bookkeeping themselves, it's essential to be aware of the potential drawbacks and risks associated with DIY bookkeeping. Hiring a professional bookkeeper like Books and Business can provide expertise, accuracy, and peace of mind, allowing you to focus on growing your business while ensuring your financial records are in good hands. Here at Books and Business we offer bespoke packages to suit your needs, whether it’s a one-off visit to sort out a specific issue or regular training to streamline your business processes we can accommodate your specific needs.

Get in touch today to see how we can save you time, email us at admin@booksandbusiness.co.uk.

HMRC’s New Basis Period Reform

Wed, 30 Aug 2023 15:30:43 GMT

Will you need to report profits differently on your Self Assessment Tax Return?

HMRC will be changing the time frames in which sole trader and partnership businesses use to calculate their taxable profits. Previously, the self employed could report profits according to their own business accounting year end date. However, going forwards if a business accounting year end does not finish on or between 31 ^st March – 5 ^th April, in line with the UK tax year (5 ^th April – 6 ^th April) the profits will need to be reported differently on the Self Assessment tax return.

Starting from tax year 23/24, known as the transitional year, the new basis period reform will apply, meaning an affected business will need to report profit up to the UK tax year end (5 ^th April) regardless of when it's own business accounting year ends. For example, if your accounting year end is 31 ^st December, you will need to report profits from 1 ^st January 2023 up to 5 ^th April 2024.

This could mean that more than 1 year of profits may need to be reported, therefore may need to be apportioned between the 2 accounting periods (needing 2 sets of accounts). Any excess from over a years worth of profit will be known as the ‘transition profit’. This can be reduced by Overlap relief, allowing any remaining profit to be spread over future years but only up until tax year 27/28.

It's worth noting that if your business accounting year end is within 31 ^st March – 4 ^th April you may treat this profit as if it ends on 5 ^th April.

To conclude, in the 24/25 tax year, a businesses income tax liability will be calculated based on the profit during the tax year only, not it's own accounting period. If businesses want to continue to use their own accounting end (not the same as the UK tax year), they will need to make apportionment calculations every year when calculating the taxable profits.

Utilising a Bookkeeper to estimate and calculate profit for your self assessment tax return could save you time and money, especially if your current year end does not match the UK tax year. Get in touch to see how our bookkeeping services could help you and your business, email us at admin@booksandbusiness.co.uk

Accurate books - key to business success!

Mon, 31 Jul 2023 19:33:58 GMT

As a business owner, one of your main goals is for your business to succeed. But is there a secret to success? As bookkeepers we believe accurate books goes hand in hand with a successful business.

Running your business without up to date financial information can be a recipe for disaster, just knowing roughly what you have isn't going to guarantee you take your business to the next level. In order to be the best you can be and work as efficiently as possible, make sure you know your monthly profits and losses as well as have a good understanding of your cashflow.

When you have accurate books in your business it gives you a sense of confidence when making financial decisions. Being organised and able to understand exactly what is going in and out, not only saves time but shows you are a trustworthy business. If you need a cash injection from investors or other sources, having accurate books will aid in the lending decision.

We all know that cleansing feeling when everything is where it is meant to be; that can also be said for a businesses bookkeeping! When everything is in right the place, recorded correctly and all up to date, it is one less thing to worry about. Not only can you relax, but it leaves time to focus on other more important areas of the business such as marketing.

Not forgetting, the advantages of being on top of your bookkeeping gives you the knowledge of which areas are working best and bringing in the most profit as well as areas that perhaps need some more work. Accurate books can be a key insight into how to improve and ultimately grow your business.

Not all business owners have the time to keep their books accurate and manage the bookkeeping in-house. If you struggle with not having enough hours in the day and the bookkeeping always seems to be at the bottom of your to do list, why not consider hiring a bookkeeper? The money you would spend on a bookkeeper is essentially invaluable to your time. Take the burden of trying to keep everything organised yourself and pass it to a bookkeeper.

Here at Books and Business we offer a bespoke bookkeeping service that can be tailored exactly to your business needs. From a full bookkeeping service to a more ad hoc or training type service, we have a package suitable for every business. Get in touch for a quote by emailing admin@booksandbusiness.co.uk

New 150k tax threshold good or bad?

Thu, 29 Jun 2023 19:36:01 GMT

In our weekly tip no. 37 we reported that HMRC had increased the self-assessment (SA) tax threshold from £100k to £150k, starting from tax year 23/24. Meaning if your tax return for the 22/23 period is between £100k-£150k from PAYE income alone, you will be exempt from submitting a return the following year. HMRC will notify these individuals with an exit letter removing them from self-assessment for the 23/24 tax year. This new deduction is to help HMRC by reducing the amount of self-assessment returns they have to process.

However, it may seem like one less thing to do for some, but it's not that simple as there are other criteria that could keep individuals still needing to submit a SA tax return! Such as untaxed income or being self-employed with an annual income over £1,000 to name but a few.

If HMRC send you a notice to fill out a tax return you must still do so but you can ask to be removed if you no longer meet the new reduced amount criteria. If you have been removed but subsequently receive any income or capital gains tax liability you have until 5 ^th October following the end of that tax year to report it e.g. by 5 ^th October 2024.

New changes aren't always smooth sailing so even if from 23/24 you no longer need to submit a tax return we strongly suggest you personally keep a close eye on whether you are paying the correct amount of tax, ensuring your tax code is correct. It is unlikely HMRC will pick up on any errors and therefore could result in over or under payments for years!

Why check VAT numbers are correct?

Wed, 24 May 2023 16:46:54 GMT

Since the UK left the EU back in 2020 HMRC introduced an online VAT number checker service to replace the old VIES system. You can enter the VAT registration number of your supplier or customer into the system to check if it is a genuine VAT number. If it is, the system will reply stating "Valid UK VAT number" as well as supply the trading name and registered business address. This response is dated and timed which means you can print and or save the result for your records to use as proof that the VAT number was valid at the time of your search. In addition, you can also tick a box and HMRC will supply a separate certificate of the valid VAT result, however you will need to enter your own VAT registration number in order to get this certificate. This can be used as evidence to show when you checked if a company had a valid VAT number should HMRC challenge input tax recovery or try to get payment back from lost VAT.

If you have a new customer or supplier, who has recently registered for VAT there may be a delay and therefore their number might not show up on the system, this can also be the case if a business has recently changed some of their details e.g. address, HMRC will be updating its records and it may therefore also not show up as valid.

If you do not get a response from the HMRC VAT service you can go back to your customer or supplier and ask for evidence to prove they are VAT registered such as a copy of their VAT registration certificate which is issued directly from HMRC.

It is important to annually check VAT if your sales are subject to reverse charge declaration instead of charging VAT on your sales invoices just incase they have deregistered without letting you know.

Claiming VAT without a valid VAT number can lead to HMRC rejecting your claim! Not only could this mean your left paying a bill but you'll also have to deal with the admin to sort out the error.

HMRC's online VAT checker service link

Bookkeeping services - what's the point?

Mon, 24 Apr 2023 19:14:52 GMT

In order to run a successful business a business owner must wear many hats, it can be a challenging experience particularly when it comes to managing the companies finances. Financial management is a crucial aspect of any business, but it can be time-consuming and complex. This is where a bookkeeper can help. In this blog, we'll explore how a bookkeeper can assist a business owner in managing their finances and why it's beneficial to have a bookkeeper.

What is a bookkeeper, and what do they do?

A bookkeeper is responsible for maintaining accurate financial records for a business. This includes recording all the financial transactions, reconciling bank statements, creating financial reports such as profit and loss statements, balance and cash flow statements, as well as managing accounts payable and receivable and completing VAT returns. A bookkeeper works with business owners to ensure that all financial records are concise so that the business is operating efficiently.

Bookkeepers also ensure that a company’s financial records comply with accounting regulations and standards.

Bookkeeping tasks can include tracking sales, purchases, receipts, and payments, processing invoices and receipts, preparing payroll, and managing budgets. Not forgetting the use of cloud accounting software, which will become a requirement in April 2024 (as long as HMRCs MTD goes ahead as planned for the submission of self assessments and VAT returns). The cloud accounting software manages this financial data which in turn streamlines processes to save time, bookkeepers are experts in cloud accounting systems.

How can a bookkeeper help you?

A bookkeeper will keep track of all the businesses financial transactions which ensures your financial statements are correct and more importantly up-to-date. Having a clear concise picture of the finances of the business is vital for financial planning and decision making.

In the long run a bookkeeper will save you time and money. By leaving the finances to a bookkeeper you can focus on more important aspects of your business such as marketing and future growth. Additionally, a bookkeeper can identify financial inefficiencies to help save money, they can streamline your processes and point out areas where you would be more efficient, perhaps by using a more modern method or technology.

A bookkeeper helps to keep on top of credit control meaning you should get paid on time, and the bookkeeper will paying your invoices on time too; an imperative part of the success of any business.

A bookkeeper will also get involved with the tax preparation of your books meaning your accountant has less work to do, hopefully saving you money with a smaller invoice from your accountant!

With the introduction of MTD and the need for compliant software like QuickBooks spending time watching tutorials and getting to grips with new software can be laborious and time consuming for any business owner. Not only can a bookkeeper deal with the cloud accounting software for you but they can also offer step by step training such as QuickBooks training, in manageable chunks to suit your business and lifestyle. Once you become more comfortable with the MTD software you save time using it, therefore its money well spent on required training. Books and Business offer bespoke training packages to suit all our clients needs, from regular training, to one off sessions to focus on any areas you may be struggling with. Our training packages are listed here .

In conclusion, hiring a bookkeeper can provide many benefits to a business. If you're a business owner struggling with financial management or need assistance with getting set up for MTD, consider hiring a bookkeeper like Books and Business to help you manage your finances more efficiently.

Why have regular training?

Wed, 15 Mar 2023 16:26:17 GMT

At Books and Business we encourage all our clients to have regular training on QuickBooks; but why is this so important?

A recent visit to a client to provide their usual training saw us discussing the importance of what to check when manually entering payments into QuickBooks. Unfortunately, when these payments are not entered into QuickBooks correctly it can cause issues further down the line, which in turn means the accounts take longer to reconcile.

We showed this particular client that when entering payments manually onto QuickBooks they must double check the bank account from which the payment was made, as well as the date which the payment was issued. This is to ensure that the payment and the transaction, which comes in from the automatic bank feed, matches. When it all matches up reconciliation is quick and simple, which saves time.

We provide this straightforward QuickBooks training, we talk you through exactly what to check and where, as well as how it should look when reconciled. This ongoing QuickBooks training ultimately saves time and money. As QuickBooks Pro Advisors we can provide bespoke training packages to suit your needs, just get in touch for a quote.

Why we need to understand how your systems work

Mon, 27 Feb 2023 20:40:43 GMT

How Books and Business recently helped a client get there systems in order

A recent visit to a client saw us being tasked with linking their new POS (point of sale) system to their QuickBooks account. Despite some initial teething issues with the two systems not talking to each other, meaning their total sales invoices and their receipts of money weren’t being shown correctly on QuickBooks, we managed to iron all these out. This left the client free to utilise the benefits of a new more modern system and not have to worry if their QuickBooks was linking correctly.

The same client also uses their POS system to keep track of stock but unfortunately the way the staff were entering this into the new system by way of using delivery notes, was not matching the amount and VAT from the supplier invoices. This could have potentially left the accounts in a mess, meaning more time would be needed to fix the errors created by the POS. In order to rectify this, we slightly tweaked the way staff were inputting the new stock on to the POS in order for it to match the invoices.

At Books and Business we feel it is imperative to fully understand how our clients and staff use their systems, this way we can ensure they are working efficiently with their cloud accounting package. This saves time as it means less visits from us to sort through errors and mismatched transactions which in turn allows you to focus on more important areas of the business such as training and business development. Not only that, we believe educating our clients and their staff so they understand the implications of using systems in a certain way could detrimentally affect the financial records of a company. Providing guidance and making a few small changes can make all the difference. When systems are linked correctly its vital that everyone gets on board with the most efficient way of working, even if that means updating old ways of doing things.

We are always on hand to provide ongoing or adhoc support for our clients, dependant on their business needs at the time, hence why our bespoke packages are our most popular.

Please get in touch for more information on how we could help your business

HMRC VAT penalty charges shake up!

PH186232 — Tue, 10 Jan 2023 18:39:32 GMT

Here is a brief reminder about the various new HMRC changes to VAT penalties and interest charges that will replace the old VAT default surcharge system. HMRC have also made a short video about the changes, watch it here .

HMRC will issue new penalties for VAT returns that are submitted late as well as VAT that is paid late . Interest will also be charged on these payments as well as the amount overdue.

If you submit your VAT return late

From now on if you submit your VAT return late you will receive penalty points, this includes nil payment returns. For each late return you will receive 1 penalty point. Once you have reached your penalty threshold (see below) you will receive a £200 penalty, followed by a further £200 penalty for each subsequent late submission whilst you are in your threshold.

Accounting period Penalty points threshold

Annually 2

Quarterly 4

Monthly 5

Visit HMRC's website for an example of how this works with a business making quarterly returns as well as thresholds for businesses that use non-standard accounting periods or make changes to their accounting period here

If you make your VAT payment late

HMRC have advised that late payment penalties, which the sooner you pay the lower the penalty will be, will apply to any payments of VAT not paid in full by the required due date. However, you can request a payment plan known as a Time to Pay arrangement with HMRC if you are struggling to make payments; they suggest you do this as soon as possible. If an arrangement is agreed, it could mean lower or no late payment penalties dependant on your circumstances.

The first late penalty will come into force if your payment is 16 or more days overdue. Followed by a second penalty if your payment is 31 or more days overdue. For example:

First late payment Second late payment

penalty penalty

Payment up to 15 days overdue None None

Payment between 16 & 30 days overdue 2% on the VAT None

owed at day 15

Payment 31 days or more overdue 2% on the VAT daily rate of 4% per year

Owed at day 15 on the outstanding balance

plus

2% of what is still charged everyday until

outstanding at day the balance is paid in full

Therefore, in order to avoid a late payment penalty ensure you pay in full by day 15 or arrange a Time to Pay arrangement with HMRC before day 16.

Visit HMRC’s website for more information on late payments here

Late payment interest

HMRC will charge you interest on any late payments from the first day the payment is overdue, this is in addition to the late payment penalty which becomes due if the payment is more than 15 days late. Interest is charged at the Bank of England’s Base rate which is currently 3.5% plus 2.5%. Interest will also be charged on late payment penalties and late submission penalties as explained above.

Visit HMRC’s website for more detailed info here

Making Tax Digital for ITSA delayed!!

PH186232 — Tue, 20 Dec 2022 16:09:46 GMT

April 2026 and April 2027 for MTD ITSA

There has been many suggestions that MTD for ITSA would need to be delayed and it is now official, yesterday the 2 year delay was announced by the Government. MTD for ITSA will apply from April 2026 instead of April 2024.

This means certain self-employed individuals as well as landlords will have extra time to get on board with the new digital way of doing things for their income tax and self-assessment. But not only has the date been pushed back, but the income reporting threshold has also been increased. MTD for ITSA will now apply to those earning over £50,000, these self-employed and landlords will be required to use MTD compatible software on or before April 2026. However, if you earn between £30,000 - £50,000 you have an additional year and will need to join MTD by April 2027. Those earning under £30,000 is under review and we will report on this as soon as any further information is released by HMRC.

The Government and professionals have recognised that self-employed and landlords are currently facing testing times and do not need the added pressures of a new tax system. Even though the new way is more efficient and cost effective in the long run it has been decided people need longer to get prepared for MTD if they need.

Read our MTD for ITSA page to understand more about MTD for ITSA here

We are still suggesting you get on board with MTD for ITSA when it most suits you, but sooner rather than later as the longer you have to get used to the systems and new ways of doing things the less time and effort you will spend on your tax return in the future.

MTD for VAT is already in place, you can read our webpage here for more information

As always if you would like a bespoke quote or friendly chat about MTD please get in touch

Christmas opening hours 2022

PH186232 — Tue, 13 Dec 2022 17:32:09 GMT

Christmas Opening hours

We will be closing at 5pm on Friday 23rd December 2022 for the Christmas period. We wish all our clients a very merry Christmas and happy and prosperous New Year.

We will be re-opening on Tuesday 3rd January 2023 and look forward to working with all our clients in 2023.

If you urgently need us over the Christmas period please send an email to Vivian@booksandbusiness.co.uk and we will endeavour to get back to you as soon as we can.

Autumn Budget Lowdown

PH186232 — Mon, 21 Nov 2022 20:57:10 GMT

The Autumn budget was announced by Jeremy Hunt last week, it focused on 3 key areas stability, growth and public services.

We have summarised a few of the main points:

Tax

- Personal allowance will stay at £12,570 until 2028

- Higher rate tax threshold will stay at £50,271 until 2028

- Additional rate tax will be reduced from £150,000 to £125,140

- The allowance for dividends that is tax free will be reduced to £1,000 in 2023, and then reduced again to £500 in 2024

- Annual Exempt Amount for Capital Gains Tax will be reduced to £6,000 from £12,300 in April 2023 and then again to £3,000 in April 2024

- Employers NIC frozen until 2028 and employment allowance will remain at its new level of £5,000 until March 2026

- Electric vehicles will not be exempt from vehicle excise duty from April 2025

- Previously announced cuts on Stamp Duty will remain but only until 31 March 2025

Minimum Wage

- The new hourly national minimum wage will increase from 1 ^st April 2023, the new amounts are as follows:

Apprentices - £5.28

Age 16-17 - £5.28

Age 18-20 - £7.49

Age 21-22 - £10.18

23 and over - £10.42

This is still below the ‘real living wage’ which is £11.95 in London and £10.90 outside of London.

Benefits

Pensions, universal credit, disability benefits and other means tested benefits will increase in line with inflation by 10.1% in April 2023.

The whole budget can be read on the gov website

Latest Tax Filing Deadlines

PH186232 — Thu, 17 Nov 2022 16:33:37 GMT

We know this time of year can get hectic so we have put together a list of those all important tax filing deadlines from now until January 2023:

19 November

CIS returns due for month ended 5 November 2022

EPS due for month ended 5 November 2022 so HMRC can apply a reduction on what is owed from FPS

PAYE, NICs, student loan deductions and CIS deductions due for month ended 5 November 2022 paid non electronically

22 November

PAYE, NICs, student loan deductions due for month ended 5 November 2022 paid electronically

30 November

Corporation tax return due for accounting periods ended 30 November 2021

Deadline for amending corporation tax returns for accounting periods ended 30 November 2020

1 December

Corporation tax due for accounting periods ended 28 February 2022 where not payable by instalments

HMRC reviews advisory fuel rates for company cars

7 December

VAT returns and payments due for month or quarter ended 31 October 2022

14 December

Corporation tax instalment payments due for large & very large companies

17 December

PAYE, NICs, student loan deductions and CIS deductions due for month ended 5 December 2022 paid non electronically

19 December

CIS returns due for month ended 5 December 2022

EPS due for month ended 5 December 2022 so HMRC can apply a reduction on what is owed from FPS

22 December

PAYE, NICs, student loan deductions and CIS deductions due for month ended 5 December 2022 paid electronically

30 December

Submit online personal tax return for 2021-22 if taxpayer wants HMRC to collect tax underpayment (below £3,000) through PAYE coding

31 December

Corporation tax return due for accounting periods ended 31 December 2021

Deadline for amending corporation tax returns for accounting periods ending 31 December 2020

1 January 2023

Corporation tax due for accounting periods ended 31 March 2022 where not payable by instalments

7 January

VAT returns and payments due for month or quarter ended 30 November 2022

14 January

Corporation tax instalment payments due for large & very large companies

CT61 returns and payments due for quarter ended 31 December 2022

19 January 2023

CIS returns due for month ended 5 January 2023

EPS due for month ended 5 January 2023 so HMRC can apply a reduction on what is owed from FPS

PAYE, NICs, student loan deductions and CIS deductions due for month ended 5 January 2023 paid non electronically

21 January 2023

PAYE, NICs, student loan deductions and CIS deductions due for month ended 5 January 2023 paid electronically

30 January 2023

Returns and payments due by tenants and agents for rents to non-resident landlords for quarter ended 31 December 2022

31 January 2023

Self assessment tax returns deadline for 2021-22

Online personal, trustee and partnership tax returns due for 2021-22

Personal and trustee self-assessment balancing payments, and any Class 2 NICs and capital gains tax, due for 2021-22

Personal and trustee first self-assessment payments on account due for 2022-23

Last date for submitting online 2020-21 personal, trustee and partnership tax returns to avoid 12-month penalty

Deadline for amending 2020-21 personal, trustee and partnership tax returns

Deadline for trusts and estates, with a tax liability for the first time in 2021-22, to register with HMRC’s Trusts Registration Service and for others to update for changes

Corporation tax return due for accounting periods ended 31 January 2022

Deadline for amending corporation tax returns for accounting periods ended 31 January 2021

If in doubt about any deadlines, don't delay give us a call today, we can clarify what is needed and when.

VAT fraud – why you need to be alert!

PH186232 — Tue, 01 Nov 2022 16:22:11 GMT

HMRC will actively seek out businesses that commit VAT fraud

Therefore being able to show you have taken the necessary steps to prevent fraud from occurring in your supply chain is crucial!

HMRC will be using what is known as the 'Kittel' principal which shows whether a business owner has been fraudulent, knew about the fraud or more importantly should have known about the fraud.

Business owners need to be alert and able to demonstrate that their VAT returns and VAT charges from suppliers or contractors are 100% legitimate and accurate.

HMRC will view it that it is the business owners responsibility to make sure their business is compliant which includes their supply chain and ensuring any risk of fraud is minimised. This can be by way of policies and key checks that are actively implemented along the way. Business owners need to be able to show documented proof that VAT fraud has been avoided.

If VAT fraud has been committed in the supply chain HMRC can deny the input tax you claim on your expenses. Meaning you could potentially receive a VAT bill from HMRC even if you have paid VAT to a supplier. The Kittle principle suggests you “should have known” the goods were part of a fraudulent supply chain. It's that good old saying “if it seems too good to be true – it probably is”. As well as having to pay back the owed tax, HMRC may also slam you with a penalty for your careless behaviour.

There are a few signs to spotting fraudsters - the cheap price being the most obvious, but they usually trade through newly created Ltd companies with little to no assets. If you are doing your due diligence on any new suppliers such as checking the trading address is legitimate, check where the goods are sourced from etc, as well as ensuring this is all documented, you stand less chance of being done for VAT fraud.

The best practice to follow is to ensure your business has the necessary procedures and due diligence checks in place to minimise the risk of committing VAT fraud, especially with any new supplier.

We are always just a phone call or email away if you need any assistance with your VAT processes. Call us on 07483 388 319 or email admin@booksandbusiness.co.uk.

A week in the life of a Books and Business Bookkeeper

PH186232 — Thu, 06 Oct 2022 16:31:46 GMT

Although we say we aren’t just bookkeepers we thought we would show you how by giving a rundown of a typical week in the life of a Books and Business bookkeeper.

Tuesday

Travelled into London for a meeting with a client at their offices to discuss the way forward for their business. This included how using Books and Business as their bookkeepers could develop and grow the business further by providing them with assistance in the areas they are spending unnecessary time, allowing them to focus on more crucial areas of the business.

Wednesday

QuickBooks training with a client. The client happily deals with their own bookkeeping but was having problems matching up payments from their banking review screen to the outstanding invoices and credit notes on their system. We helped clear the problematic areas and then chatted through the importance of payroll journals being entered into the bookkeeping system, if your payroll is run in a separate software or even by an outsourced payroll bureau. Books and Business will be going back for further training while the client practices in between.

Friday

QuickBooks training with the same client as above, revisiting the information given at the previous session. After realising how time consuming bookkeeping can be the client also passed over the reconciliation of 5 credit card accounts covering a large period as unfortunately the client had entered dates incorrectly, had possible duplications and just couldn’t work it all out. The client believed it would be less stressful and time consuming if they handed the job over to Books and Business to get it all sorted and brought back up to date. Once we had worked our magic the client could take it back over fresh and tidy.

We are not like all bookkeepers, we are happy if you do your own bookkeeping but perhaps from time to time you need the odd bit of assistance here and there. We like to save our clients time so they can focus on the more important aspects of their business.

If you would like Books and Business to provide you and your business with any assistance, please get in touch – we look forward to helping you grow your business further.

MTD penalties are confirmed!

PH186232 — Mon, 05 Sep 2022 19:52:50 GMT

If you still submit your VAT returns via your gov.uk online account you need to be aware that HMRC have confirmed they will be issuing fines as of 1 ^st November for submitting your VAT in this old way. Making Tax Digital (MTD) is the new way of submitting your VAT returns via MTD compatible software such as QuickBooks or Xero.

As we have previously reported (read our blog here ) all VAT registered businesses must sign up to MTD to keep VAT records and file VAT returns, the deadline was April 2022. Although the deadline has passed there is still time to get registered before facing a fine. There is an exception, HMRC have stated that any business that files annual VAT returns will still be able to use their old VAT online account until 15 ^th May 2023.

What could I be fined?

Any VAT registered business who files their VAT returns without using MTD software could be charged a Filing Through the Incorrect Channel (FTIC) penalty.

Fines are based on a company’s turnover and is per every return filed incorrectly, they are as follows:

£100 for turnover below £100,000
£200 for turnover between £100,000 and £5,600,000 inclusive
£300 for turnover between £5,600,001 and £22,800,000 inclusive
£400 for turnover is £22,800,001 or above

However, if you are already exempt from filing your VAT returns online or if you are subject to an insolvency procedure you will still automatically be exempt and therefore will not be charged a fine.

If you aren’t MTD ready, don’t panic. We have a number of different packages available to suit your needs and budget, check out our MTD for VAT page here or drop us a an email admin@booksandbusiness.co.uk

MTD the next phase…ITSA

PH186232 — Thu, 21 Jul 2022 18:41:00 GMT

Income Tax Self-Assessment also known as ITSA

ITSA will be introduced on 6 ^th April 2024 (previously scheduled for April 2023), it applies to all self-employed business owners and landlords who have an income over £10,000. If this applies to you, you will need to comply with the new digital way of submitting tax returns from April 2024.

Although it seems like ages away we recommend beating the crowd and getting yourself set up and familiar with the new ways of doing things sooner rather than later. Giving yourself time to get to know the new software needed for MTD at a pace suitable to you is beneficial to your business rather than trying to rush and learn something last minute.

Firstly, you need to decide on a software that is fitting to you and your business, here at Books & Business we have extensive knowledge in QuickBooks and use it as our chosen compatible software.

Once you have chosen your software the next steps are to begin using it, this will give you time to get to know your way round the software and get some training or support well before the deadline in 2024.

But what are the costs associated with the new MTD ITSA??

These will vary greatly depending on your current set up, for example, a business that doesn’t use spreadsheets or any form of accounting software, as in they keep no form of digital records, will have a much larger outlay than say a business or landlord who already has cloud accounting. The outlay will be in the way of time as well as upfront and ongoing costs.

We have put together a page on everything you need to know about MTD ITSA check it out here . It also includes all the packages we offer with regards to getting you MTD compliant whatever stage you are at.

If you are currently not keeping any digital records now would be a great time to make a change to digital record keeping. If, however you already do this and submit your own Self Assessment Tax return you will need to ensure your current software is compatible with MTD (current HMRC self-assessment software will not be usable once MTD ITSA is in place). Check out our MTD page here for a link to which software packages are MTD compliant.

If you need further assistance or just want to talk through your options regarding MTD drop us an email and we can arrange a mutually convenient time to have a free initial chat.

New contact number

PH186232 — Wed, 13 Jul 2022 20:54:31 GMT

Update your contacts as we have a new telephone number!

Our new number is 07483 388 319

Do you raise invoices promptly?

PH186232 — Mon, 13 Jun 2022 16:46:15 GMT

When business is booming, you are focused on ensuring all orders are filled, customers are served, all works are done etc etc; but this could mean that trying to get your invoices out on time may start to slip. They may start to get issued later and later meaning the money isn’t coming in as the invoices aren’t going out.

Staying on top of the admin side of your business can become a strain on resources; not only can raising vital invoices fall behind but following up on the payments and what is overdue can also slip. The longer you take to invoice someone you run the risk of the invoice not being paid at all. Trying to then figure out what you have billed and when, what is owed and who from can be a bit of a nightmare!

Preparing invoices is just one job that a bookkeeper can take off your hands, as well as preparing the invoices a bookkeeper can chase overdue payments to ensure your books are always up to date which reflects the exact financial position your business is in.

Not only is preparing the invoices an added stress to your daily routine you must also ensure you pay your outstanding bills on time too. Not paying your suppliers on time can put your business at risk and potentially ruin your reputation. However, you can use a bookkeeper to either schedule in a “payment run” once a month or alternatively with the right paperwork in place with your bank, they can set up the payments on your banking system too making sure you are always on time with paying your suppliers, which can help to building a good rapport with your suppliers.

Give us a call today to see how we could help with your business administration; see how much time we could free up in what is an already a very busy role.

Common mistakes made when you do your own bookkeeping

Tue, 10 May 2022 17:24:26 GMT

Without getting into the technical side of bookkeeping we thought we would flag up some of the more common errors made when business owners decide to take on the task of doing their own bookkeeping.

However, before we get into it, we aren’t suggesting you shouldn’t do your own bookkeeping, but we have found that in the long run it can actually save a business time and money to pay for someone who is experienced in bookkeeping, to give you a hand. We have written a separate blog on "why you need a bookkeeper", read it here for the different levels of support you could receive from a bookkeeper; from training through to a full bookkeeping service depending on your business needs.

So, lets kick off with the most obvious error and number 1 on our list:

1 – an incorrect entry

Obvious right, and it sounds so simple but a wrong date, amount or wrongly named item can cause so many problems including making your accounting software not work correctly. When your business bank account is connected to you accounting software the software will match the amounts on your bank to the receipts you have entered, as long as they are entered with the correct information. Therefore, if you have entered any of these incorrectly the amount won’t match, and it will be added again. One wrong date or an accidental typo can lead to you having to manually go back over every entry to try and find where the error has come from, which can be a timely and frustrating mistake.

2- separate business and personal accounts

Having your personal and business transactions in the same place can be a nightmare, not only do you have to spend time separating out what is personal and what is business but having everything in one place makes it easy to miss things you should be accounting for. We recommend always keeping business and personal bank accounts separate. It removes the confusion of what belongs to you personally and what you’ve earned through your business. Splitting these transactions correctly is important as it can impact the information you declare on your tax to HMRC.

3 – ad hoc bookkeeping

When bookkeeping isn’t done regularly it often leads to errors and inaccurate information as the work builds up and up and before you know it, it’s all that is occupying your mind which then leads to a rushed job to get it all done in time. We all know what happens when you rush a job - mistakes are going to happen! If you want to do your own bookkeeping it really is a regular weekly or monthly task that needs to be strictly kept on top of. When you leave your bookkeeping until the last minute you don’t have an up-to-date accurate financial position of your business therefore making it impossible to make realistic decisions about the financial future of your business.

4 – not understanding your accounting software properly

There are many accounting software packages available since the introduction of MTD, which if used properly can make your bookkeeping super-efficient as well as saving you time but we often find people are not using this software correctly. We suggest regular training on your chosen software to ensure you are using it not only correctly but to its best ability relevant for your business. Here at Books and Business we offer training on QuickBooks, we can provide an ad hoc session or a more regular slot to ensure you are always getting the most of out of your software.

These are just a few general mistakes that we often find when undertaking an audit of a clients QuickBooks records. As already mentioned we can offer training on QuickBooks, we also offer an audit of your books and records to get things back on track so you can start a fresh, and of course there is our full bookkeeping service which we can tailor to your specific business needs. Send us an email with your requirements and we will get back to you with a plan of action including costs.

Why you need a bookkeeper!

Fri, 22 Apr 2022 14:10:47 GMT

We thought we would kick off the new tax year with reasons why you need a Bookkeeper!

Entrepreneurs and business owners are great at doing everything themselves, its probably why they have set up their own business and why the thought of spending money on something they could do themselves is madness!!

We get it.

But if you could have more time to grow and improve your business, work more productively, and have a better work life balance surely spending a bit of money to achieve this is a no brainer?!

There is some truth behind the saying “you’ve got to spend money to make money” because hiring a bookkeeper will allow you more time to concentrate on the running of your business whilst they take care of the financial side of things as well as staying on top of your tax obligations. Instead of worrying about collecting receipts, making sure an invoice has been paid, managing your payroll or reconciling your bank statements your bookkeeper will manage all of it (or as much as you need) saving you valuable time. This time could be spent increasing your marketing efforts, improving your products or customer experience, ideally making your business more successful or just allowing you more time to do your job productively.

As well as this bookkeepers collate real-time financial information which in turn can offer valuable insights into your business and allow future planning.

Perhaps you are a dab hand at bookkeeping though, and happy to do it yourself, but have you thought about bookkeeping training? A bit of training on specific areas you may be weaker in could speed up the process and allow you to work even more efficiently; training would ensure you are working to the full potential with the package you currently use such as QuickBooks

Bookkeeping, although an expense, should be seen as an investment as it will ultimately save you time in the long run and you know the saying time is money!

Here at Books and Business we offer a bespoke bookkeeping service from a full service including the new VAT for MTD set up and monthly managing to ad hoc training or even just a one-off reconciliation of your accounts to make sure everything is running as smoothly as it should do.

Send us an email with your specific requirements and let us tailor a package to suit your specific business needs.

There is still time to get help with MTD for VAT

Tue, 29 Mar 2022 15:52:11 GMT

To make things as simple as possible we have put together several packages to ensure you are being MTD compliant depending on your specific needs. From a simple licence package, right the way up to an all-in package which includes taking care of all your bookkeeping needs.

The MTD packages we offer are noted below, however, if one of them doesn’t suit your needs please do get in touch to see if a bespoke package is more suited to you.

Bronze package

We can provide a QuickBooks licence which is an MTD complaint software for you to use to send your VAT returns to HMRC digitally. With this package you would do your own bookkeeping.

Silver package

For those looking for a bit more assistance, the silver package offers the QuickBooks licence as per the bronze package however we also provide two hours of support each month. This could be one off training on something you are not as competent in; checks to go over your systems to make sure everything is running as smoothly as possible or general pointers to save you time. As per the bronze package you will also do your own Bookkeeping.

Gold package

This is our all-in package, not only do we offer the QuickBooks licence and provide support but with the gold package we will do your Bookkeeping as well.

Tech package

This is our training package, perhaps you are already set up for MTD or you are happy to manage it yourself but just need a little extra guidance, our QuickBooks ProAdvisor can provide training to ensure you are getting the most out of QuickBooks. This training will ultimately save you time by fully understanding the software and how it can work most efficiently with your VAT reporting needs. This could be on an adhoc basis, a one off or perhaps you want something more regular to ensure you are always up to date.

Whatever stage you are at, be it you haven’t even started thinking about MTD or you already have QuickBooks but you haven’t quite got your head round it, our packages can be tailored to your needs.

If you are interested in learning how our packages could assist you then please initially drop us a message below or send us an email to admin@booksandbusiness.co.uk with all your details and we will be in touch to discuss how we can help.

Digital Tax Making

PH186232 — Sat, 12 Feb 2022 08:52:13 GMT

Obviously we mean Making Tax Digital (MTD)

It’s been the word on the street that its coming for a long time but it really is the case now as all VAT registered businesses must sign up, whatever they earn.

If you are VAT registered, you must sign up for Making Tax Digital from the 1 ^st April 2022 in order to file in the new digital way. That’s just over 6 weeks away !

The idea behind MTD is for businesses to keep digital records and to file their VAT returns using an MTD compatible software like QuickBooks. The whole new digital process should therefore make it simpler and quicker to file returns, which in turn will give the tax payer more confidence in what they are submitting is correct. Although it becomes mandatory from the 1 ^st April it would be more beneficial to take the leap and get started with MTD today.

The Government has advised from 1 ^st April 2022 or the beginning of that VAT period you must keep digital records and submit VAT returns through MTD or you may be charged a penalty.

Support on how to sign up to MTD can be found on the Government website here or we at Books and Business can assist you by signing up on your behalf to ensure you are MTD compliant. Not only can we set you up we can provide ongoing training for QuickBooks MTD compliant software. In the long run this will save you valuable time to focus on your business.

According to the HMRC guidelines you must sign up at least 5 days after your last non-MTD VAT return deadline and no less than 7 days before your first MTD VAT return deadline or you may pay twice!

Get in touch with us today to see how we can get you sorted for the looming MTD VAT deadlines.

Declare your Covid funding on your tax return

Thu, 27 Jan 2022 16:47:35 GMT

Did you receive any of the government covid grants during the 2020/21 tax year?

If so read on to make sure you know what to declare

As we know many businesses as well as the self-employed received financial support from the government by way of grants and support schemes during the pandemic. These income packages are however all taxable and will need to be declared to HMRC.

Self-Assessment Tax Return reporting:

SEISS

According to HMRC more than 2.7 million people claimed one of the Self-Employment Income Support Scheme (SEISS) payments, of which there were 5 in total.

As the SEISS payment is taxable it needs to be declared on your 2020/21 self-assessment tax return before the deadline of 31 ^st January 2022 but only if you received any of the first 3 payments (received on or before 5 April 2021) . If you received the 4 ^th or 5 ^th payments this can be declared on your 2021/22 tax return. In order to declare the SEISS grant on your self-assessment tax return the payments should be added in the Self-Employment Income Support Scheme Grant box.

Other Grants

The other grants provided by the Government during the pandemic were:

Test and trace / self-isolation payments
CJRS – furlough scheme
Eat Out to Help Out
Covid Statutory Sick Pay Rebate
Covid Business Support Grants

These grants must also be declared on your self-assessment tax return but these are to be declared in the business income box .

However, not all of the covid support grants need to be reported, for example, if you received a welfare payment from the council which helped with your council tax payments or housing benefits you do not need to report these on your Self Assessment tax return.

Company Tax Return reporting:

The Coronavirus Job Retention Scheme (CJRS) and the Eat Out to Help Out payments that were given during the pandemic also need to be declared on the Company Tax Return. HMRC have stated the following when it comes to declaring it:

include it as income when calculating taxable profits in line with the relevant accounting standards
report it separately on the Company Tax Return using the CJRS and Eat Out to Help Out boxes

Note that the Coronavirus Business Interruption Loan Scheme loan and Bounce Back loan do not need to be reported on your tax return.

HMRC are reiterating how important it is that everyone takes extra care to ensure these grants are reported correctly on their tax returns. Therefore as long as you use the new specific boxes for reporting all the grants it should be clear where these new taxable items should go.

Are you ready for the new VAT penalty system?

PH186232 — Wed, 12 Jan 2022 10:25:04 GMT

Are you ready for the new late payment penalty system?

The default surcharge system for late VAT submission and payments is coming to an end, it will be replaced by a new points system for late submissions and a 2 charge system for late payments. From 1st January 2023 everyone who submits a VAT Return for VAT periods starting on or after 1 January 2023 will be affected if VAT returns are submitted or paid late.

Late submission - point system

This new system is based around the taxpayer receiving a point for every late submission of their VAT return, but there will be no Surcharge Liability Notices issued. It will apply to VAT returns, annual return filings and quarterly updates under MTD. Therefore if a taxpayer misses a deadline they will incur 1 point. The idea behind this is to penalise those who regularly miss deadlines. Each taxpayer has a points threshold depending on the frequency of their submissions, if this threshold is reached a fixed penalty of £200 will be issued. To establish what a taxpayers threshold is see below; a further £200 penalty will be issued for each subsequent late submission following breach of this threshold.

Annually 2 points

Quarterly 4 points

Monthly 5 points

Points can be reset to zero but only once the following 2 conditions have been met: submission of all returns on or before the due date for a set period of time (based on the above filing times - annually - 24 months, quarterly - 12 months and monthly - 6 months) as well as ensuring all outstanding returns that were due in the past 24 months have been received.

Late payment – 2 charge system

The second change is the way penalties are issued for late payments; the new way allows for more flexibility whereby there will be no penalty for a taxpayer who pays late but pays within 15 days of the due date. However, once the 16 ^th day is reached the 1 ^st penalty is set at 2% of the outstanding amount. This needs to be paid between day 16 and 30 after the due date. On day 30 an additional 2% of the amount outstanding also becomes due.

The second charge comes in if at day 31 there is still tax outstanding, this will be at a rate of 4% per annum and is charged on a daily basis.

HMRC have stated that taxpayers who are struggling to pay are to contact them to request a Time to Pay Arrangement where an agreement to pay the outstanding amount over a period of time can be discussed. As soon as proposals for a Time to Pay are put forward and agreed the daily penalty will stop accruing.

So in a nutshell don’t go over your points threshold by submitting your VAT return late and pay your tax within 15 days of its due date!

Christmas Opening Hours 2021

Tue, 14 Dec 2021 22:15:26 GMT

Our Christmas opening hours are as follows:

Monday 20th December 08.30 - 17.30

Tuesday 21st December 08.30 - 17.30

Wednesday 22nd December 08.30 - 17.30

Thursday 23rd December 08.30 - 17.30

Friday 24th December closing at 12.00

Saturday 25th December - Tuesday 28th December Closed

Wednesday 29th December 08.30 - 17.30

Thursday 30th December 08.30 - 17.30

Friday 31st December Closed

We re-open for the new year on Tuesday 4th January 2022

We would like to take this opportunity to wish all our clients a very Merry Christmas and a Happy and Prosperous New Year.

Don’t call the tax man on a Friday in December!

PH186232 — Thu, 09 Dec 2021 20:31:52 GMT

VAT and CT phone lines closed on Fridays!

HMRC have confirmed they are closing their VAT and Corporation Tax (CT) phone lines on Fridays throughout December. Last Friday 3 ^rd was the first day the lines were closed and they will also be closed on the 10 ^th and 17 ^th December with the exception of the bereavement line. HMRC have advised this is a trial, which opens the possibility that the closure may continue until things are back on track!

HMRC have advised the closures are to allow them to deal with a backlog of post that has accumulated over the year as other work was prioritised during COVID-19.

However, HMRC have confirmed they expect things to be back to normal pre-pandemic levels of service by April 2022. Customers will be advised in the first week of January if the closures of the VAT and CT telephone lines will continue.

TAMD - what is it?

Thu, 02 Dec 2021 20:55:55 GMT

Tax Administration and Maintenance Day -TAMD was on 30th November 2021.

But what is it and what does it mean?

At the Autumn Budget the Chancellor made a commitment that there would be a separate day following the budget that would be dedicated to the administration and maintenance of the UK’s tax system. It was later announced that this Tax Administration and Maintenance Day TAMD would be on 30 ^th November 2021.

The idea behind TAMD is to publish various documents which include new consultations as well as updates on existing consultations and announcements made at the Autumn Budget which took place on 27 ^th October 2021. (Read our blog for an overview of the main points discussed in the Autumn budget ). There will be summaries of responses to any recently closed consultations and technical information notices.

These announcements are mainly in relation to the ongoing initiatives to modernise and improve the UK tax system and its administration. It confirms how the tax system is being simplified, modernised, making it more user friendly in order for it to be easier to get peoples tax correct.

Financial Secretary to the Treasury, Lucy Frazer said:

“ We want to build a tax system which supports the economic recovery, is simpler for businesses, and helps taxpayers get their tax right the first time.

Today’s announcements set out what we are doing to achieve this – providing people and businesses with an opportunity to engage in this work and help shape this reform .”

A summary of the key announcements can be found here

The full paper which demonstrates how the government’s 10 year tax administration strategy is taking shape is here

Changes to Making Tax Digital for VAT coming soon!

Tue, 23 Nov 2021 20:28:20 GMT

Does the extension of MTDfV affect you?

Making Tax Digital is no longer a new topic of discussion, back in 2019 HMRC introduced its MTD policy for all VAT registered businesses with a taxable turnover of over £85,000. In order to be compliant those businesses have to keep digital records and use third-party MTD compliant software to submit their tax returns to HMRC. Although not necessary, many businesses under the £85,000 threshold still registered voluntarily to join the MTD scheme.

However, from April 2022 HMRC have confirmed the extension of Making Tax Digital for VAT (MTDfV) to smaller VAT businesses which fall under the £85,000 threshold, this will include those who voluntarily registered as well as the self-employed and landlords.

The new extension will mean those that come under the VAT threshold will need to keep their records digitally and submit their tax return to HMRC through a third-party MTD software programme from their first VAT period starting on or after 1 ^st April 2022.

Further details can be found in HMRC’s ‘ Extension of Making Tax Digital for VAT ’ Policy Paper.

At Books and Business we can assist you in getting set up ready to go for the MTD April 2022 deadline. Quickbooks is our preferred partner as we feel it offers the best compatibility with MTD. We are Quickbooks Pro Advisors, therefore not only can we set you up we can also train you on the software.

If you want even more time to focus on your business, why not let us do all your bookkeeping for you? We take the stress out of everything MTD so you can focus on your business.

Lastly, we can also simply help you to register for MTD. So why not get in touch to see how much or little we can help you to get started and be MTD compliant by April 2022.

Autumn Budget in a nutshell

Fri, 29 Oct 2021 12:32:18 GMT

Autumn Budget 2021

The greatly anticipated Autumn budget was bought to the table by Chancellor Rishi Sunak on Wednesday but how might it affect you, your business and your family? Read on for our brief guide to the main points raised in the Autumn 2021 Budget:

• Inflation will rise to approximately 4% in 2022 which is up by 0.9%

• Universal Credit taper rate cut from 63p to 55p, plus a £500 increase in the Work Allowance – to be put in place by 1st December 2021

• A reminder that National Insurance Contributions (NI) will increase by 1.25% from 6th April 2022 - this is to fund the NHS and social care

• National Living Wage set to increase next April to £9.50 an hour for those aged 23 and over (see table below for other rates)

• The fuel duty freeze remains

• A pay rise for public sector staff in April 2022

• The recovery loan scheme has been extended to June 2022

• 0% Savings rate band to remain at £5,000

• Adult and junior ISA limits to remain the same at £20,000 and £9,000

• Tax bands to remain frozen at April 2021 levels for 5 years

• Business rates multiplier has been frozen at 49.9p and 51.2p from 1st April 2022 until March 2023

• Personal tax threshold limits frozen until 2026

• 25% Corporation Tax rise from April 2023

• A 50% business rate discount for businesses in the retail, hospitality and leisure industries with a cap at £110,000

• Introduction of a 100% business rates relief for 12 months for firms to carry out improvements to premises from 1st April 2023

• Capital gains tax deadline for reporting and paying capital gains tax will increase from 30 to 60 days following completion

• A massive Alcohol costs shake up where higher strength drinks to have higher duties but lower strength drinks to be cheaper. The cost of a pint will also be cut by 3p

• Smoking costs to increase on both cigarettes and hand-rolling tobacco

• A levy on property developers of high-rise flats to pay for removal of dangerous cladding has been granted

• Libraries to be revamped and put back into action with new levelling up funds

• Extra funding will be provided for projects to support new parents

• A new programme called Multiply will be introduced to improve numeracy skills in adults

• Funding for school pupils will be put back to previous levels seen in 2010

• Internal domestic flights will have air passenger duty cut making it cheaper to fly within the UK

• Income tax applicable to dividends to increase by 1.25% from 6th April 2022

• Penalties for late submission and late payment of tax for Income Tax Self-Assessment come into effect from 6th April 2024 for those required to submit through MTD (all other taxpayers will be 6th April 2025)

• Residential Property Developers Tax (RPDT) will be charged at 4% on profit in excess of £25 mil

Making Tax Digital - for VAT

Sun, 16 May 2021 14:57:33 GMT

Records you must keep digitally

VAT registered businesses with a taxable turnover of more than £85,000 must follow the rules as set out by HMRC for "Making Tax Digital for VAT" by keeping some records digitally, unless of course;

your business applied for an exemption
your business uses the VAT GIANT service

If your business turns over less than £85,000 you can choose to sign up to Making Tax Digital

The records that you must keep digitally are;

your business name, address and VAT registration number
any VAT accounting scheme you use
the VAT on goods and services you supply for example everything you sell, lease, transfer or hire out (supplies made)
the VAT on goods and services you receive, for example everything you buy, lease, rent or hire (supplies received)
any adjustments that you make to a VAT return
the " time of supply " and "value of supply" (value excluding VAT) for everything you buy and sell
the rate of VAT charged on goods and services you supply
reverse charge transactions - where you record the VAT on both he sale price and the purchase price of good and services you buy
your total DAILY gross takings if you use a retail scheme
items you can reclaim VAT on if you use the Flat Rate Scheme
your total sals, and the VAT on those sales, if you trade in gold and use the Gold Accounting Scheme

You also need to keep digital copies of documents that cover multiple transactions made on behalf of your business by:

volunteers for charity fundraising
third party business
employees for expenses in petty cash

YOU MUST add all of your transactions to your digital records however you DO NOT at this point in time need to scan paper records like invoices or receipts