TAX RETURNS

System · May 2005

Hello I've recently finished AAT and work on a Finance Dept for a large organisation where i've been for the last three years. I've recently been offered part time work from a number self employed people(sc60/715) requesting me to do their accounts for Tax return purposes. As i have never been in this position before, im looking for some advice and guidance. So far, i have come to the conclusion that what i need to set up, is a cash book to record all entries going in/out of the bank and cash income/expenditure,which is to be reconciled to the bank statements and cash in tin. From there i believe all i have to do is post the entries to an Income and Expenditure a/c, from which the profit figure will be used to calculate the Tax (using the self guide tax forms, cant be hard to fill in). Am i on the right tracks with this or is there something i'm missing. Any help wuld be greatly appreciated Thanks

System · May 2005

TAX RETURNS

You will probably also need to know allowable expenses, mileage allowances, taxable benefits, capital gains tax, income from land/buildings, etc. Tax can be quite a specialised area, did you complete Unit 19 for Technician level? Scott.

System · May 2005

TAX RETURNS

Scotty Never did the Tax unit, i'm thinking all the information for the certain type of work it involves will be available at the Tax office, after all its only self employed builder!

System · May 2005

TAX RETURNS

Builders can be the worst from my experience - as they often either get paid under CIS which has 18% already deducted or pay their own subbies less 18%, and if they are VAT registered that confuses life even more, especially as they are not good at sending out invoices....

System · May 2005

TAX RETURNS

Thanks Claudia Do you have much experience with this?

System · May 2005

TAX RETURNS

not a lot, but i will help if i can email address claudia.lowe@btinternet.com

System · May 2005

TAX RETURNS

if they only want you to do tax returns, I am not sure you need to do all of the bookeeping for them as well, as you would only need the total of the income figures for the period in question (that is if someone is already doing the bookeeping) with the bookeeping it does get quite involved, also for example builders usually claim max allowances so the tax due is as low as possible (authorities ar so much more generous to self-employed people)

System · May 2005

TAX RETURNS

Dia Yeh, none of the bookkeeping has been done, so i have no figures to go from! It looks like its going to be a full years Income/expenditure to be accounted for! Does the Tax Office have guidlines on things like this?

System · May 2005

TAX RETURNS

If you are going to do tax returns for the clients you have described, with no prior experience of income tax please make sure you have taken out adequate Professional Indemnity Insurance.

System · May 2005

TAX RETURNS

As an ATT member, and an AAT studend, working in accounting and tax practice in the last five years, I seriously recommend you take further advice. As mentioned above tax is quite a complex area, and errors made cost the client direct. Offering tax services to a client isn't simply just filing a self form each fiscal year, but is ensuring they are claiming the maximum allowances they are entitled, they do not claim more than is allowed etc. Another complex area of tax is capital allowances. Depreciation is not deductable against the taxable profits, though a tax form of depreciaion, capital allowances are. Another thing to bare in mind is Inland Revenue investigations which may come about from the tax returns filed. Preparing the financial statements is really less than half the battle, in most cases, for builders, a simple income and expenditure account would suffice. The ATT is on a simliar level to the AAT qualification. Could you imagine someone qualified in the ATT trying to prepare some financial statements without no knowledge. Even basic concepts like accruals, prepayments would be new. Tread Carefully!

System · May 2005

TAX RETURNS

to glennandrews Thanks for the advice. It really backs up what i've been thinking myself. With Tax having more of a specialised nature than most other accounting areas, a short course may be the best alternative before taking peoples money. With the ACCA coming up next for me, which contains Tax units in both the 2nd and 3rd years(optional 3rd) the Tax unit in Technician AAT may be the best route to take, on both a studying level(to prepare for ACCA) and a professional work level to get a more indepth knowledge of allowable allowances etc. I think i could probably have struggled through but the pro's werent as high as the cons! Thanks Again

System · May 2005

TAX RETURNS

I have to say that I'm doing ACCA tax at the moment (level 2) and I still wouldn't be confident doing anybody's tax returns!! I guess it's the experience as much as the tuition. That's why I find it amazing when people want to take on tax returns with no experience and just AAT tax under their belt. I think you have made a very wise decision SNP but there is nothing stopping you doing their accounts to lessen their accountants bill! Good luck Annette

System · May 2005

TAX RETURNS

I'd just like to thank everyone above for the advice given Thanks snp

System · May 2005

TAX RETURNS

I have just started work in a tax office, but before that I worked for the construction industry and I went on a couple of courses run by the Inland Revenue - which are free and held in most tax offices. I dont know where you are, but my local one is at Ashford in Kent where you can book in at the local tax offices (eg Chatham, Canterbury). Prehaps you could look at what they offer as they are either a few hours one morning or a day. They do CIS construction industry course as well as tax for the self employed. plus loads of others and like I said, it wont cost you anything and they are very helpful.

TAX RETURNS

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