Ceased business & last tax return...
edkav
Registered Posts: 37 Regular contributor ⭐
I have a "one off" client who ceased trading on 1st April 2007. His basis period is Jan-Dec. He first started trading 1st Jan 1990. I have NO records for him pre 2006... any ideas on how to deal with this one please? :001_unsure::001_unsure:
0
Comments
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I would suggest a clearance letter to his prior accountant before you take him on!
Poodle0 -
Good afternoon,
I assume your "client" is a sole trader,Poodle is right but if the person has had no professional input and has
submitted his/her own returns since self assessment in 1997-98 there should be some copy
assessments you could obtain from our "friends" at HMRC.
Bearing in mind that legally "client" needs to retain records for 5 years 10 months after accounting period end and normally individuals retain records for 6 years after 31st January self assessment date for good practice;therefore "client" could have a potential timebomb ticking if HMRC raised an aspect/full enquiry
on cessation of the business.--- this is a "hot" area at the moment.
If you proceed ensure that your engagement letter covers all relevant areas and you
ask all the right questions ie. any outstanding issues as per HMRC etc,
tread carefully,
regards,
Paulr.0 -
Thanks for your advice - I did get a copy of previous years return and no overlap relief was bought forward, so that answers that.
Thanks for the advice about investigating businesses after they have ceased trading, I didn't realise it was a hot issue at the moment - I will cover all areas anyway. Thanks again0 -
Personally I would suggest that you get hold of some earlier years tax returns - ie just after self assessment was introduced. Anyone with a 31 December year end will probably have some. It is also very easy to get lost off a tax return - particularly before the advent of computerised returns - also if they changed accountants, the new one might not have clocked it.
One of the (many) things on my "to do while its quiet list" is to check all my clients who do not have a 31.03/05.04 year end and their overlap relief.
Claudia0
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