Tax Return Uk Online
February 10th, 2010
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Question: What are self-employed ‘books’ supposed to look like?
I have been self employed for some time and do my Tax Return Online. However, I’ve noticed that some banks and other organisations request your ‘books’ if you are self employed. Could anyone (in the UK) tell me what such books should look like exactly. Of course, I have a black book listing earnings and outgoings…but should it be more comprehensive than that? Other than keeping receipts and wage slips, and filling in my account online, is there some form of specific hard copy I should be keeping? Many thanks!
Answer: As others have stated most banks, etc. mean accounts when they say “books”. They also often as for “audited” accounts when they really mean figures with an accountant’s certificate. (The word audit has a specialised meaning which most bank managers fail to understand)
But the question of what books are acceptable is a good one. You are taxed on the profit made by the business which is the difference between the income earned and the expenditure incurred. So any record which allows you to get to these figures is acceptable.
The income earned is not the same as the money received, unless you always get paid on the day you do the job. Most people record the money received so there has to be a way of working out how much is owed to you at any given time. This can be as simple as marking the date of payment on your copy of your invoice to your customer. The income earned is then the money received plus the money owing (less any money that was owed at the beginning of the period).
Similarly with expenditure.
Also if you are registered for VAT then more detailed records may be needed.
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