201802.15
0
0

Record Keeping

in News

Are you up to date with the rules of record keeping for your business?

If you have a small business you must keep records of your business income and expenses for your tax return.  This would apply if you are self-employed as a sole trader or are a partner in a business partnership. If you are the nominated partner in your partnership then you must keep records for the partnership.

If you are a limited company, there are different rules that apply.  Please follow this link for further details.

You will also need to keep records of your personal income.

What records do you need to keep?

You will need to keep records of:

  • all sales and income
  • all business expenses
  • VAT records if you’re registered for VAT
  • PAYE records if you employ people
  • records about your personal income

Why do you need to keep records?

You do not need to send your records in when you submit your tax return.  You need to keep them, so you can work out your profit or loss for your tax return and to show them to HM Revenue and Customs (HMRC) if asked.

When keeping records you must make sure they are accurate.

Keep proof of all receipts for goods, stock, bank statements, cheque book stubs, sales invoices, till rolls and bank slips.

How long do you need to keep your records?

You must keep your records for at least 5 years after the 31 January submission deadline of the relevant tax year.  HMRC may check your records to make sure you are paying the right amount of tax.

For example, if you sent your 2015 to 2016 tax return online by 31 January 2017, you must keep your records until at least the end of January 2022.

Very late returns

If for some reason you send your tax return more than 4 years after the deadline, you’ll need to keep your records for 15 months after you send your tax return.

If your records are lost, stolen or destroyed

You must do your best to provide figures if you cannot replace your records. You will need to tell HMRC when you file your tax return if you’re using estimated figures – your best guess when you can’t provide the actual figures or provisional figures – your temporary estimated figures while you wait for actual figures (you’ll also need to submit actual figures when available).

Should you have any questions relating to this article, please feel free to contact us on 01799 732188 or email abby@wilsonaccountingservices.com.


Leave a Reply

Your email address will not be published. Required fields are marked *