Dance Class Teacher Income

MaggieL

I have a client who takes aerobics/dance classes 2-3 times weekly at 2 different venues (village halls). Last year I suggested that he kept a register showing the name, contact number and amount paid for each attendee. He hasn't done this but has given me a copy of his bank statement with the amounts highlighted. It's too late now to obtain details income records so what would you do?

MarieNoelle

Hi Maggie, I assume he is a sole trader? Does he get paid cash on a weekly basis or does he invoice termly?
If he is indeed a sole trader can he justify all income received on his bank statements is solely from his trade? Do you have any previous year's accounts to compare with?
Sorry if I seem to be asking lots of questions but it will help get a better picture!

MaggieL

Thank you for your reply MaireNoelle, my client is a sole trader - this is just a part time thing for him though as he is in full time employment and a higher rate tax payer. I have produced the previous two years accounts from figures that he gave to me and at the time of producing those I suggested that he should keep list of attendees for each class (who pay 'on the door') and open a separate bank account, neither of which he has done.

burg

It's up to him effectively what records he keeps. You can advice (as you have done) on what are suitable records and advise what may happen in an investigation. Your choice now is whether you are still happy to act with the information you have if is is suitable to prepare a set of accounts and a tax return.