Accounting records & responsibilty for self assessment tax returns

HeatherButler · January 2015

Hi, I have been an MIP for 5 years and deal mainly with Sole Traders. I always make sure that my clients provide full backup for any transaction that are entered into their accounts and subsequently on the Tax Return. I have been asked by a new client (no audit required) if I will complete his accounts using only his Business account bank statement, as he has moved abroad, and cannot provide his Business receipts. My immediate reaction would be to decline his custom but I am trying to find out, if there is no audit requirements, can I complete his accounts and get him to sign some form of disclosure to say its his responsibility to prove the figures he has given me and I am acting in good faith?

Thanks

burg · January 2015

This is our normal process for incomplete records jobs. Find out from client if bank account is the main account for business transactions and that it isn't mostly cash. Use the bank account as a starting point. Refer back to receipts/invoices for anything that doesn't seem right or could be considered to not be business. Typical things are Argos, Amazon etc where anything could be purchased. You then just have to sort the non-bank transactions for which we ask for the receipts or some kind of record (spreadsheet) as well if there are quite a few.

So my thoughts would be get it done from bank statements, then ask him for evidence of anything you are not happy with.

There are very few jobs where I would be going through checking the majority of receipts to match. I'm not doing bookkeeping and I'm not being paid for it. If they want that level it can be paid for but is a bit overkill for most small businesses. This does not mean though that clients can negate the requirement to keep receipts and proper records and this is emphasized to each client.

Accounting records & responsibilty for self assessment tax returns

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