Record Keeping Flashcards
What is a receipt?
official record of proof of financial transactions - has payment method, product value
What is an invoice?
statement listing goods and services provided for record of sale. - order charge, list of order, contact info
What is an Order form?
document with products you want to buy - has payment info item name/description etc.
Why keep financial records?
Tax calculation, Calculate profits/loss through cash flow, Proof of order, Legal requirement, for future plans
What is a fiscal year?
12 month financial period for tax reporting
What is a balance sheet?
A financial statement that reports a company’s assets, liabilities and shareholder equity at one point in time.
What is a liability?
Business’ owing’s
What is shareholder equity?
Owner’s of a business belongings after liabilities are retrieved.
What does a limited company need to keep?
records about the company itself
financial and accounting records
How long do you need to keep these records?
6 yrs
Longer if late etc
What should you do if records are lost?
recreate them
tell your Corporation Tax office straight away
include this information in your Company Tax Return
What are the penalties of not keeping these?
fined £3,000 by HMRC or disqualified as a company director if you do not keep accounting records.
What is corporation tax?
No bill. limited company, foreign (UK branch), or clubs pay corp. tax. Pay it on profits, investments and selling assets. Register, keep records calculate tax to pay for tax return. Pay or report no profit/losses. 9 months + 1 day after accounting period. File tax return a year after AY.
What is income tax?
For public services and other investments. Employees pay tax on interest on savings, job benefits, employment money, pensions, self employment profit
£1000 income for self employment, renting property, lottery winnings
What is national Insurance?
Tax employees For state pension and benefits etc. maternity and bereavement
16 or over + 242 /week
