Look no further; EOG Accountants have devised a two-part blog to help you get organised, save tax, and keep the taxman happy!
EOG Accountants are Xero Accountants for business owners that want more.
Here are the essential tasks for you to complete leading up to your year-end:
Make sure you have your records in order. If you carry out the bookkeeping yourself, get your bookkeeping up to date before your year-end, not after! Doing this assists in our next step – tax planning.
Our top tip here is to make sure that you have a receipt/invoice for all bookkeeping transactions (or as many as possible) and if you’re using Xero, supply plenty of information in the transaction description box so that when your Accountant reviews your records they know what each transaction was for ensuring each transaction receives as much tax relief as possible.
Do you supply services and send invoices?
Get a Gold Star from your Accountant by referencing dates!
When sending invoices, reference in your invoices which period the service you’ve invoiced for relates to; we ask our customers to use the reference box in Xero to show us this. So, our Day Nursery customers would enter ‘April 2022’ for childcare provided in April even though it is invoiced in March 2022.
Doing this will help your Accountant calculate your Sales in Advance and Work in Progress figures, allowing for accurate profit calculations and ensuring HM Revenue and Customs are happy if a tax inspection were to occur.
Once you’ve got your bookkeeping up to date, it’s time to consider your upcoming tax liability and what you can do to reduce it! Waiting until you meet with your accountant after the year-end is too late!
This area can be slightly tricky and generally requires professional advice. At EOG Accountants, we offer a set service where we sit down with our customers’ pre-year end to discuss their options. We usually do this two months prior to year-end to give our customers plenty of time to act upon our advice. Why not ask your Accountant if they offer a tax planning service? If the tax savings your experts find outweighs the cost of their fees, it’s a no brainer!
Some of the areas your Accountant is likely to consider are:
At the most basic level, you can review your business’s profit and loss and balance sheet, calculate an estimate of how much tax you will have to pay, and start putting money to one side for your upcoming tax liability.
Part 2 of the blog looks at year-end bookkeeping, stock taking and systemising your year-end process, click here to take a look.
This information is subject to change and is not professional advice. Refer to our disclaimer for more details.