I am no longer a freelance bookkeeper but I am looking for full time permanent employment.
I’ve left this site up to exemplify my skills to prospective employers but please feel free to continue to use it as a bookkeeping resource.
Everything you need to do your small business bookkeeping is right here!
Continue reading ‘Small business bookkeeping how-to’
You must register for VAT if your turnover for the previous 12 months exceeds the VAT threshold, currently £73,000 (2011-12). This is called compulsory registration and you’ll be fined heavily if you don’t comply. If you think you’ll go over the threshold in the next 30 days then register for VAT by contacting HMRC. Note that the 12 month period is just the previous 12 months and is not in anyway connected to your accounting period.
If you think you’re getting near this threshold then keep a running total of your turnover for the previous 12 months. Turnover in this context should include all sales within the scope of VAT, even zero-rated supplies! Exclude only those that are exempt or outside the scope of VAT.
Continue reading ‘Should I VAT register?’
If you make a loss, as we all do from time to time, make sure you use it to your advantage by claiming tax relief on it!
You can offset a loss against other taxable income (and then any capital gains) for the current tax year or your total income (and then any capital gains) for the previous tax year.
Furthermore if you make a loss within the first four years of a business, as many startups do, you can offset this against your total income for the previous three tax years including earnings from regular employment.
Continue reading ‘Your loss or HMRC’s?’
Business expenses add up to reduce profits thus reducing your tax liability. You’ll need evidence of all these expenses so keep all receipts for anything that can be reasonably construed as a business expense. Yes, even that bus ticket on the way to town to buy stationery, another legitimate business expense!
Continue reading ‘No (allowable) expense spared’
Petty cash is cash that you keep aside (usually in a petty cash box) for small items of expenditure like postage stamps, paper clips etc. If you’re in a cash based business there’s a great temptation to merge petty cash with cash income and just take cash as and when you need it. However this is a very bad idea as it makes accurate record keeping much more difficult. Not having accurate records of cash in and out of a cash business is bad because HMRC like to look very closely at cash based businesses because they know how easy it is for this type of business to make ‘mistakes’ in their own favour.
Continue reading ‘Accounting for petty cash’
Bookkeeping plays a key rôle in every successful business. Without accurate books you have no idea how well or otherwise you are doing financially. You may feel good about your business but you don’t know that financial ruin isn’t just around the corner.
Continue reading ‘Reasons to love bookkeeping’
Your year end or accounting date is the date to which your accounts are usually made up. You should choose this within a few months of commencing trading. Many businesses set this to 31/3 (or 5/4) to tie in with the tax year (ending 5/4) but many retailers choose 31/12 to tie in with the calendar year and to better fit the typical retail trading cycle. Your first set of accounts, made up to this date, are unlikely to be for exactly one year but more likely from 6 to 18 months. Subsequent accounts will be for exactly 12 months until you cease trading or change your year end.
Continue reading ‘Choosing a suitable year end’
In recent years, failure to budget for payment of that first tax bill has put more sole traders out of business than any other single cause. If you make a profit, you will have to pay tax and it could well be for a lot more than you think so please don’t be in denial about this!
Continue reading ‘Will your first tax bill put you out of business?’
Bookkeeping is the process of recording all the financial transactions connected with your business. It should include all money coming in and going out, who owes what to whom and what your business physically owns or capital.
Bookkeeping is not accounting. Accounting starts where bookkeeping leaves off. So accountants look at reports created from your bookkeeping records to, say, complete your tax return or draw up your year end accounts etc. Unlike accounting which happens perhaps just once a year bookkeeping is an ongoing operational and analytical tool providing essential feedback on the financial health of your business.
Well kept books form the cornerstone of a well run business, a fact that is not lost on venture capitalists and other sources of credit. They are necessary whatever the financial climate but absolutely essential when times are tough and credit difficult to acquire. Banks are much more likely to lend to businesses which are demonstrably well run. Good bookkeeping exemplifies this.
Continue reading ‘What is bookkeeping?’
