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Self Assessment Help!!

moneymotivatedmoneymotivated Feels At HomeRegistered Posts: 35
Afternoon all, I hope one of you can help me!!!

A friend of mine's accountant unfortunately passed away late last year.

He used to do my friend's self assessment and VAT returns.

Going forward my friend wishes to do his own self assessment which should be fine as he is a milkman so has a straightforward income and expenditure book which he records his transactions in.

His only problem is the previous accountant used to do a P & L and B/S for the tax return.

My friend hasn't a clue about P & L's etc so was wondering if he could just simply do an I & E for his tax return?

I couldn't see why this would be a problem but i'm sure there are probably implications such as transferring the assets and claiming CA's etc.

I must admit personal tax is something I scarcely do in the workplace so am pretty clueless so apologies if this is a stoooopid question!

Has anyone come across this before or can offer some advice??

MM

Comments

  • MonsoonMonsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    There's no obligation to do a BS for a small sole trader - but if you're preparing accounts in double entry, you'll naturally produce one.

    Doing a basic I&E account would be fine, but remember it really ought to be on accruals accounting not cash (which is what an I&E usually is). So you'dd need to make sure things reconcile and any accruals/prepayments are accounted for.

    The capital allowances are a separate issue to the balance sheet and you'd carry on doing those as normal.

    Not sure what you mean about transferring assets.
  • wildgoose1ukwildgoose1uk Well-Known Registered Posts: 200
    I&E accounts are usually for non-profit organisations and are on the accruals basis, Receipts & Payments acocunts are again for nfp orgs but these accounts are on a cash basis.

    As Monsoon says if oduble entry acocunts are kept then it would fall naturally out of that.

    In reality though all HMRC are interested in is how much money they can get out of you so as long as the statement is clear in terms of taxable profit then I do not really see a problem.

    As Monsoon says ca's are a seperate issue.
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