Business & Real Estate

If I, who are employed or have a small business, it is important to maintain control of your finances with a good accounting software or accounting system. There are two main reasons for this – so that you can manage your business effectively and accurately for you to complete your self assessment tax return.

However, once the system in place, you still need to make sure you are recording all transactions properly and updating records on the target system on a regular and organized. Otherwise, at the end of the fiscal year, you could find yourself buried under a mountain of unidentified documents.

Here are the top five tips on making self assessment simple, for anyone who has to fill in self assessment tax return.

1) File documents immediately

If you do not file immediately, the documents that are required to accumulate a lot scary and difficult to control. To keep things clear, store all invoices and receipts in two separate files – one for sales and one for purchases. Give each of these transactions a unique reference number and record it in any accounting software or accounts system you have chosen. Archiving of documents to this number, so you can quickly retrieve the information should be subject to a tax or VAT inspection.

2) sort your transaction documents

Record details of each of their transactions in the direct points such as insurance, salaries and rent, and also remember to record your own income, VAT inputs and outputs of cash, if necessary, and unimportant as this will make it easier to retrieve when needed. Petty cash can be made easier to follow if you store receipts along with a certain amount of cash (for example, Ј100), then when it is necessary to replenish the pot, remove the record of income and its system accounting.

3) Always ask for receipts

It is vital to have records of all transactions. In order to offset their expenses against your profits, you should be able to demonstrate that these costs are completely, exclusively and necessarily incurred in connection with your business. For those who are subject to VAT, it is necessary to keep VAT receipts so you can recover the VAT on the transaction.

4) Use bank statements regularly to check their accounts

To consolidate the accounts and ensure that you are recording all transactions and to ensure that the bank has not made an error in your accounts, check your bank statement against your own records at least once a month. To do this effectively will take the previous bank balance, add to the payments you have received and deduct everything that has made, and ensure that the result is the same as the current bank balance. If there are errors then make sure to monitor them.

5) Carefully consider the best way to record your transactions

For very simple bookkeeping, you can use a specialized online accounting software. There are many to choose from in all different prices and with different benefits, but most require a certain level of knowledge about accounting. However, there are some accounting software packages out there easier.

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