Category Archives: Accounting

Self-assessment is a tax system utilized by Her Majestys Revenue and Customs (HMRC) to collect income tax. Tax is deducted at source from individuals and businesses. Many taxpayers are not aware of what self-assessment tax returns in the United Kingdom are. This article will provide the information required to support submissions.

Eligible parties: If you are an employed or a self-employed citizen, you are eligible to send a tax return if you earned more than £1000 as an individual or as a partner in a business. However, if your only income is from wages and pension, you do not need to send a return. If you have rental, savings and investment, tips and commission income, you need to send a return. This applies if you worked between 6th April and 5th April the previous year.

Penalties for non-compliance: If you submit your tax return 3 months late, you will be penalised up to £100. You will also be charged interest. However, you can appeal for a penalty waiver if you have a valid reason for default.

Registration and sending a return: As a new taxpayer, you need to register as a self- employed, employed person or a partner in a business. You will be billed upon filing your tax returns. For the purpose of keeping accurate self-assessment tax returns, you need to keep records. There are no specific ways to keep these records; they can be manual or automated. They need to be complete and accurate.

Assistance regarding self-assessment: If you are not able to file returns, you can employ an accredited accountant to do it on your behalf. If you are stuck while filling the returns, they can provide the necessary help that you may need and can also assist with general inquiries.

Return for a deceased person: If you have a deceased person whose taxes need to be filed, the first thing you must do is to report the death to HM Revenue and Customs (HMRC). You will be advised accordingly. You need to specify the date of death as well as the name and address of the deceased. If HMRC requires you to fill in the taxes of that person, you will need details such as bank statements, dividend vouchers among others.

Consequences of overpaying or underpaying: If you overpay, you will receive a refund from HMRC and if you underpay you will be penalised.

As a taxpayer, you need to prioritise paying tax; otherwise, HMRC will take action against you. This could be through the forced collection by engaging a debt collection agency or a court action could be taken against you. Your business could be at risk of being closed down. It is important to take your tax returns seriously and a good accountant can take the pressure off by managing the process for you.

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To participate actively in business, it is often necessary to register a limited company. It provides an effective vehicle for the execution of enterprise. This type of company is private in nature. Also, it can be a sole proprietorship or a partnership. In the latter, the owners are only liable according to the amount of equity that they hold. Like any other enterprise, a limited company needs to perform accounting. Here is a general description of the accounting activities which it needs to implement.

Accounting requirements for a limited company

Statutory annual accounts: At every end of a financial year, a limited company needs to complete statutory annual accounts. These details are sourced from the companys financial records. The statutory annual accounts provide an in-depth view of the commercial activity that the limited company has engaged in. These statutory annual accounts are usually shared with Her Majestys Revenue and Customs (HMRC), all your shareholders and Companies House.

Company Tax Returns: This is a record of the taxes which a limited company needs to report to the HMRC. It is absolutely necessary to make these returns if the company reports a loss or has no taxes for that specific financial year. In Company Tax Returns, some accounting factors are determined. An example of these is the profit or loss for Corporation Tax. This is very different from the profit or loss which is usually indicated in statutory annual accounts. Also, a limited company is expected to calculate and pay a Corporation Tax bill. You can calculate it on your own or hire an accountant to do this for you.

Corporation Tax: This is an important element that is included when filing Company Tax Returns. The Corporation Tax is paid from all the profits that you make if you perform business as a limited company. This tax does not arrive as a bill. Instead, you must calculate it yourself. It applies to all trading profits. This tax also applies to any investments which you perform. Furthermore, if you sell any business assets at prices which are higher than they originally cost, these margins also attract Corporation Tax. This is applicable for all limited companies based in the United Kingdom (UK).

Deadlines

Company Tax Returns and Corporation Tax both have deadlines. These deadlines differ depending on the accounting element involved. Company Tax Returns have a deadline that is 12 months after the accounting period involved ends. For the Corporation Tax, your deadline is 9 months and a day after the conclusion of the associated accounting period. There are stiff penalties if you should miss on any deadline. Therefore, it is important to stay alert and aware of the deadlines associated with these accounting elements.

Limited companies in the UK have accounting obligations. They include statutory annual accounts, Company Tax Returns and Corporate Tax. These obligations have deadlines assigned to them. The process of calculating and filing them can be automated using Cloud accounting software. Not only does it manage the day to day commercial activity in your limited company, online accounting software also files all regulatory obligations automatically for you.

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There are so many tax deductions that are available to all those that file taxes and many people arent even aware of what these deductions are. Below are three overlooked deductions that can potentially raise your tax refund.

State Sales Tax is the perfect write off for those individuals that live-in places where there is no income tax. You can make a choice between either deducting your local and state income tax or your local and state sales tax. For most people that are in income tax states, the tax deduction based on your income is the best deal.

If you live in a state with income tax, the IRS has a table for its residents and their particular states which shows you how much you are allowed to deduct; however, the table is just a guide and more can be added to it as well; for example you can add sales tax if you boat a boat, airplane or car. The sales tax can be deducted if it does not go over the allowed sales tax deduction that has been approved for your state and income limit.

First Job Moving Expense is also deductible. Now, if you have expenses that you have received from looking for a job then this is not a deduction that you are entitled to but if you are moving for a job you can get this deduction even if you arent using itemization, $0.23 cents per mile can be deducted if you moved more than 50 miles away and your household items, tolls and parking fees can also be deducted.

Charitable Contributions can include gifts that you have given throughout the year that you have paid for by check, cash or that has come straight out of your payroll check. The good deeds that you are doing throughout the year add up and they can be used as a deduction. If you are one of those people that prepares food for a nonprofit organization or you mail off postcards or mail for a fundraising event and you bought all of the stamps, envelopes and even pens; all this can be a deduction.

Did you drive your car to these events? You can use your mileage as a deduction as well, just be sure to look up how much you can get per mile and use that deduction. The items that you drop off to say a Goodwill company can be used as a deduction as well, just ask them for a receipt.

No two jobs are exactly the like. While some require physical strength or careful observation, others require adhering to a strict set of rules to ensure the desired outcome is reached. Regardless of the position, most can be trained and tested for to become more proficient in the position. This is especially true with jobs like accounting, where ethical standards are quite important. With that in mind lets take a brief moment to review ethics for Texas CPAs. What are CPAs and what requirements legal or otherwise exist? Lets take a moment to find out.

Certified Public Accountant

The Certified Public Accountant (CPA) is a particular title given to those accountants who take classes and pass examination. This means meeting certain state education and experience requirements before completing a final program. In many states, there are certain guidelines on who can and cannot call themselves a certified public accountant. Ethics for Texas CPAs require that no person be allowed to call himself or herself accountant or auditor.

Ethics For Texas CPAs

As stated above, to call you a CPA in Texas requires going through the program and passing an examination. This guarantees that there is a certain standard for professionalism. One of the requirements is occasional ethics for Texas CPAs. This means that licensees interested in getting or renewing their Texas CPAs license have to complete a 4-hour approved ethics course. The Board as detailed in the Board Rule 523.131 approves the courses. Currently, this course must be completed once every other year. The frequency of ethics courses and the requirement of ethics courses in the first place are subject to change depending on board rulings. While there is currently a requirement in place, it may be that in a decade or so ethics for Texas CPAs are no longer required.

Are Standards Similar Outside Of Texas?

Good question. Outside of Texas, there are different standards for CPAs. For example, some states have no limitations on what people can call themselves. So, in some states you can call yourself an accountant or even a CPA without breaking the law. Outside of North Carolina, Kansas, and Arkansas, there are some restrictions on it. Be aware that the majority of people with a CPA status are also a part of the American Institute of Certified Public Accountants. If you are interested in getting your CPA, then you are in luck. It is always possible to begin the process to get your certification.

Countless studies exist which prove that automating your business processes is not only beneficial to business owners and employees but also helps companies provide better customer service.

Employers who have chosen to move to cloud accounting software, particularly Xero, notice a significant increase in productivity, given that it frees up a lot of time for employees to do other things.

Companies that switch to Xero have noticed significant time savings because the outdated bookkeeping practices of the past which generate enormous amounts of paperwork are taken out of the equation.  Because simple  tasks are automated with Xero, your business runs more smoothly and efficiently.

Once you make the move to Xero, generating reports also becomes easier because all the information you need is on hand and it’s updated and accurate. You can see immediately whether your company is profitable or whether you’re in trouble.

And if budget is an important factor in the running of your business, which it should be, you can rest assured that cloud accounting software is saving your company money. Not only is the software itself affordable, you can use it no matter your staff compliment or size of your operation. Companies with hundreds of staff members or those with just one owner operator, all benefit from cloud accounting. With Xero you don’t even need to purchase licenses so that all your employees have access, access is unlimited.

In our competitive market, growing your business should be your main priority, not your taxes, or payroll or accounting processes. Xero accounting software allows you to focus on what really matters – expanding your business.

NBC Accounting Firm in Brisbane has been introducing their clients to Xero since 2009 and has helped hundreds of businesses automate their accounting processes professionally.  They can help you make the right choices for your business including add-ons that can make running your business more efficiently a reality.

You needn’t be concerned about the safety of your information, Xero security is akin to that used for internet banking. That means your data is secure, even if your computer crashes or you are a victim of theft.

The hassle sustained by you could not be less than it is with Xero. Even updating the software is taken care of. You never need to upgrade your accounting software again because with Xero upgrades are automatic.

Efficiency is guaranteed because in contrast to the past offline accounting systems which left a lot of room for error, cloud accounting software allows you to integrate with other business applications. NBC can help you figure out which applications synced with Xero can help benefit your business.

There’s a reason cloud accounting software has become so popular, it allows you to get paid faster and make payments faster as well. You can use it on any device, even your smartphone, so no longer do you need to be office bound. Whether you’re paying bills, invoicing clients or doing online banking, Xero imports your bank transactions if you link it to your bank accounts.