Personal tax returns for individuals are based on sole traders end of year accounts. Similarly partnership returns and corporation tax returns are based on partnership and company accounts.
For a partnership, the year end accounts also show profit allocated to each partner and his current account balance. For limited companies, the regulatory requirements are more than sole traders and partnerships. There are disclosure requirements for directors salaries and dividend payable to shareholders. The information thus disclosed should match with directors personal tax returns.
The year end accounts provide valuable information about a business. You can see how your business is performing. You can also compare business performance with the previous year’s comparative figures. Analytical review of accounts, like checking gross profit and net profit percentages help you to improve your business performance by taking right decisions in future. Any differences can be highlighted and investigated.
The year end accounts are also submitted to third parties like bank when you apply for a business loan or mortgage, or to a property management agent when you want to rent a property.
Businesses are free to pick whatever year end they want. However such date should be selected carefully and after discussing with your accountant.
Some businesses will pick the tax year like 5th April as their year end date to avoid any complicated calculations for overlap relief, however this is applicable to the sole traders and partnerships only.
Some companies prefer to choose 31st March as the year end date so that their dividend declared in the accounts always match to the amount of dividend in their personal tax return. Picking the tax year will make your tax liability based on the latest finalised accounts and therefore as current as possible.
Some businesses select a year end date which is a bit quiet time in their trading cycle, so that they can deal with the stock count, bookkeeping queries, year end accounts, tax returns more easily as they they have more time available.
You should look to prepare sole traders accounts and partnership accounts well ahead of the tax return deadline of 31st January. Limited companies have nine months from their year end to complete their accounts, but it’s always good to schedule the accounts preparation as soon as possible after the year end date. This is because you memory is more fresh with the financial information at that time rather than 9 months after that. This helps you to spend as much time as you need to prepare the accounts, which is good as rushing can lead to errors. It also helps you to complete the filing in time and avoid any potential penalties.
We can prepare your accounts from whatever bookkeeping records you have . You may be using a software, spreadsheets, hand written records or even a bag of receipts. We can do accounts based on any form of records you have. We will also advise you on how to improve your bookkeeping method in future. After looking into your bookkeeping records, we advise you on how to maximise your expenses and allowances that you can claim legally and how to minimise the tax liability. You will find that once we have asked us to deal with your accounts you will free very relieved of a stressful and time consuming job.
Our team of professional accountants offer a very competitive fee. We have flexible time for appointments and dedicated team members to offer a simple, professional and friendly advice.
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