Tax return record keeping

Discussion in 'Managing Your Business' started by adamangler, Jan 19, 2016.

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  1. adamangler

    adamangler Wakefield Window Warrior
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    For anyone who does their own returns,

    Do you have to record every single job money recieved for or just the money recieved

    I.E - week 1 recieved £300 window cleaning
    week 2 recieved £400 window cleaning

    or mrs brown £10
    mrs bloggs £12
    mrs taxy £10


    etc

    online payments are easy as the info is all in my bank statements but what about cash? would i be wise to pay all cash into the bank so theres a record of it? i know you dont have to.

    do i have to specify exactly where every penny has come from and the date, or just the fact i recieved £100 today for window cleaning

    I use george but the records are not accurate on it money wise as i only use it as a guide for my round order and not for financial record keeping


    think im going to get an accountant for next tax year, ive managed up till now as i was part time and not eligable to pay class 2 or 4 but i will be soon, i also have a baby on the way and partner will be claiming some benefits and i have an ex parnter who i pay child maintenance to and my head is fried trying to work it all out, i also had loans and stuff and apparently the interest is taken into account in some way o_O
     
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  2. Greener

    Greener Well-Known Member
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    #2 Greener, Jan 24, 2016
    Last edited: Jan 24, 2016
    Hi adamangler I keep a daily record of all individual cleans on a exel spread sheet and a formula calculates the value of money earned. My way of thinking is that if the tax man was to request to see my income surely he would expect to see the weekly £400/£500 broken down in detail. I don't put how they paid but if required it would be simple enough to show as they have either paid via BACS transfer (so would show on my business account) paid via PayPal (so would show on my PayPal account) or they paid cash ( I don't bank my cash it just goes in the household pot and we spend it as required). As I understand it if HRMC require it you must be able to show a break down of all income and outgoings to the penny. Put it this way you wouldn't expect to be able to say I've spent £500 on various items for the business ( Expenses) this week and not expect to prove the individual costs.
     
  3. mark

    mark Forum Addict
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    yes record everything,income and expenditure-its not the best when you get a tax investigation.if they find fault and you cannot prove it,they will go back six years and assume you are dishonest-that's why I have anccountant and pay an investigation insurance fee,record everything!!!!
     
  4. Greener

    Greener Well-Known Member
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    With regards to employing an account, I would defo recommended it. I'm now in my second year and last year I chose to do my books myself and to be honest I found it pretty easy but that was mainly down to my experience from another life im fanatical about record keeping LOL. However this year I decided to have a FREE chat with a local accountant just to see how much it would cost aslo to give me some piece of mind regarding doing things within the law, I certainly didn't want to work as hard as I have done building the business only to have a large tax bill due to me not doing something that I wasn't aware I should be doing.

    Within half an hour he had already saved me enough money to pay for his services throughout the year simply explaining certain things I could claim for that I hadn't been claiming for in my first year. I feel silly thinking it now but it was the obvious things like Half of my phone costs, laundary ie cleaning of my uniform and electricity used while doing my computer stuff ect ect. It's going to cost me £240 a year payable once he completes my return and to be honest its worth ten times that to me for piece of mind alone.
     
  5. Greener

    Greener Well-Known Member
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    Hi ya mark what's this investigation insurance fee your taking about buddy?
     
  6. adamangler

    adamangler Wakefield Window Warrior
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    Cheers guys ive been recording all expenses and keeping reciepts, also one off jobs like carpet cleaning or car valeting i give receipts and keep a copy
    but for window cleaning ive not broke it into individual customers i just record the total taken for the day

    i suppose i should break it down into individual customers, seems a ballache

    and yes i will get an accountant for in april for next year, nt earned that much self employed this year as ive been part time employed for most of it so will go through everything and make sure its all in order
     
  7. Greener

    Greener Well-Known Member
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    That's business buddy :whistle:;)
     
  8. daveyboy

    daveyboy Legend
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    Whether you use an accountant or not you do need to record everything
    I am not sure how george works but with round partner that i use when someone pays me i click yes on the bit that says paid on that job and then it asks cash..cheque or other
    I can bring up monthly reports on there and just copy/paste into a monthly excel spreadsheet which i keep for the taxman
    I don't differentiate between paypal..bacs..go cardless etc as bank statements would show it all if hmrc wanted to look
    As for cash no need to pay in the bank..they just have to believe your records as long as they are consistent
     
  9. mark

    mark Forum Addict
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    my accountant, offers all of her clients a tax investigation insurance cover(yearly)obviously at cost.ive had one. it can be very expensive to fight.the funny thing is I was proved right & the revenue owed me money.they will stop at nothing.they will follow you in unmarked vehicles,if they think you are being dishonest. they did this to a windie I know of(it was his own fault & fined hard)
     
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  10. Green Pro Clean Ltd

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    One of the biggest improvements to my business came from reading Lord Sugars book. 'The way i see it'

    He talks of his early days and the main factor in forwarding his success was knowing at any time where every last penny was.

    My daily routine has now become, arrive home, plug van in to fill up, open bottle of cider and spend 20 minutes updating books.

    This really has made a huge difference as i now know to the penny my running costs, wages, bank balance, debts and credits and so on.

    This allows me understand when to accept a job and sometimes when not to. When taking a large commercial can I 'afford' to take it on and give them terms do i have or can i afford the equipment required to do it.

    In my eyes in running your business there is nothing more important than knowing where every last penny is.
     
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