• LizMoneyBee

What paperwork do I need to keep?



We all LOVE a bit of filing. Well, when I say ‘love’ I probably mean ‘detest’.

But it still needs to be done for your business to be HMRC compliant.

You’ll need all your records to be able to create your accounts for your Self-Assessment anyway, so you may as well keep them together in one place – and since you’re doing that, you may as well keep them neat and tidy and in some kind of sensible order.

The key to keeping your paperwork well-organised is to imagine that someone important looking with an HMRC-issued clipboard is going to knock on your door and audit you at some point this week, or next week, or next month... You don’t really want to have them sitting in your living room looking surly whist you scrabble about trying to find an invoice from 23 months ago do you? And they will NOT be impressed if you can’t provide all the evidence that goes with your tax return. They may even decide you've made it all up and tell you off (or worse!)

To make absolutely sure you’re doing all you need to … here are the requirements:

If you are using ‘cash accounting’* then you’ll need to keep records of:

· all sales and income

· all business expenses

· VAT records if you’re registered for VAT

· PAYE records if you employ people

· records about your personal income

these can be proved by keeping the following:

· all receipts for goods and stock

· bank statements, chequebook stubs

· sales invoices, till rolls and bank slips

And you have to keep all of this for at least 5 years after the 31 January submission deadline of the relevant tax year.

e.g.

If you sent your 2016 to 2017 tax return online by 31 January 2018, you must keep your records until at least the end of January 2023.

All of this doesn't have to be in printed out paper format - but you do need to be able to access it easily so if you are saving electronic copies of things then make sure they are in a logical place, that you know all your passwords and that you can access them up to 5 years later.

*Cash accounting is where you recognise income and expenditure when it leaves or comes into the bank. If you are using ‘Traditional Accounting’ then there is more record-keeping to consider.

NB: this is a valid reason to spend a few hours on Pinterest looking at 'home filing solutions' or similar.

If you have any queries, please get in touch: SAY HELLO!


0 views

©2020 by Money Bee