Making Tax Digital – Are you ready?
VAT Registered Business from April 2019
The clock is ticking as VAT Registered Business i.e. Turnover in excess of £85,000 will need to submit their returns via MTD Compliant Software. The HMRC online portal currently used will no longer operate.
Therefore, if you currently process your Accounts on a spreadsheet or similar software then log onto HMRC to submit a VAT Return you will be affected.
AK Bookkeeping use SAGE and XERO Software for our clients and this is compliant with the MTD requirements from April 2019. Give us a call to arrange a meeting to discuss how we can help at a price significantly less than most Accountants.
Companies, Sole Traders, Partnerships currently not registered for VAT
Business under £85,000 turnover or Sole traders such as Plumbers, Builders, Retailers who currently submit their accounts at the end of the year have until April 2020 to get ready. Again compliant MTD Software is required but submissions will be quarterly.
If you currently drop a bag of receipts to your Accountant at the end of each year then you will be breaking the law and liable to penalties if you fail to change to quarterly accounts.
A big issue is the cost that an Accountant may charge for doing your accounts 4 times a year instead of 1. You should therefore find out what it is likely to cost. Call us for a competitive quotation.
What You Should Know About Your Taxes as a Business Owner
As a business owner, corporate tax issues will be part and parcel of your routine and one of the main tasks that your accountant will have. If you are a director of a limited company, the tax issues responsibility falls on you. You have to make sure that the business’s tax issues are in order and that the tax liability is accurate. This also includes ensuring that HMRC is paid on time.
What is Corporation Tax?
Corporation tax is based on limited companies and their taxable income or the profits they make. As the owner of one you need to calculate this yourself and you need to pay the amount to the Inland Revenue without an assessment beforehand. The payment date is 9 months and 1 day after the due date of the business and this is usually the very last day of the accounting period itself.
The good news is that this tax rate will be cut from 20% to 17% come 2020 according to the government. The accounting period cannot be more than 12 months for this tax and it is usually the same financial year that your business’s annual accounts fall under. The duration also has an effect on your deadlines and filing your tax returns.
You can check your accounting period by logging onto the online service for HMRC and by checking the dates there. Once your business is registered for Corporation Tax, the HMRC will send you a letter for your exact accounting period.
What is Value Added Tax?
Value Added Tax or VAT is tax that is based on the consumption of certain services and goods that are accumulated through each stage of distribution and production. In other words, most services and products that come from a business will be accountable for this tax. The standard VAT rate is 20% but this can change according to the business you have. You should register for VAT if:
- The total value of taxable supplies or services within 12 months is more than the registration threshold (which amounts to about £85,000).
- If the forecast value of said supplies in the next 30 days or so may be more than the threshold.
The amount includes not only the profits you gain but also the amount that is being spent on the business and going through it. The returns have to be submitted online and the good news is that any and all liabilities can be settled electronically.
AK Book-keeping can help you with all of that and more. We are based in Peterborough and have been in the book-keeping business for decades.
If your paperwork is taking you away from things that should have your undivided attention, then you know who to turn to. Allow us to manage your books so that you can manage your business with little or no distractions. Satisfaction guaranteed!
Call Les’ Hotline: 07732090847
Email: Les@akbook-keeping.co.uk
www.akbook-keeping.co.uk
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