A guide to accounts and VAT returns


Basic books for business should help you to keep book-keeping records that you need to satisfy the needs of:

  1. The Inland Revenue
  2. HM customs and excise
  3. Us as your accountant

Do I have to know anything about accounts to use this book?

No! We’ve assumed you know nothing. If you do know something already, we hope this book is of use anyway.

Who should use this book?

This book is intended for people who are VAT registered and use the VAT Cash Accounting Scheme. If:

  1. You are not VAT registered, or
  2. Your sales are too big to let you use the VAT cash accounting scheme (which means they have to be more than £600,000 at present).

Then this book is not for you. We have another book for businesses that are not VAT registered. If your sales are more than £600,000 you should probably be using a computer accounts package to keep control of all your business records. We can advise on this.

What types of business should use this book?

This book is aimed at two sorts of business. These are:

  1. Sole Traders
  2. Partnerships

It is intended for just about any business run by either of these except for a retailer, where different systems are needed to allow for the number of transactions that take place and the large amounts of cash involved. Ask us for advice if you are a retailer and we will recommend alternative ways of keeping accounts.

If you operate as a limited company large parts of this book will apply to you, and you could keep records in the way shown in this book. You will however need to talk to us about how to record payments you make to yourself. This is the only modification required, but just remember that whenever this book refers to paying you will need alternative advice from us.

What is covered in the book?

The book covers provides all the information most people will need to:

  1. Do the book keeping for their business.
  2. Keep the Inland Revenue happy if they ever ask to see your records
  3. Keep records to prepare VAT returns

What is not covered in this book?

This book is not a comprehensive guide to VAT. If you have a problem with VAT either read the VAT guide published by HM Customs and Excise or we’ll be pleased to help.

The book does not deal with the operation of PAYE (pay as you earn) income tax on payments to employees. This is complicated area. Before paying any employees or sub-contractors check what you propose to do to make sure you get it right. Mistakes in this area can be very expensive. We will be happy to help. Remember you are an employee of the business if you are running a limited company.

What will you need to write up your records?

You will need:

  1. A Collins Cathedral “Red” analysis book
    (4: 16.2)(or equivalent).
  2. About 5 ring binder files.
  3. Paper
  4. A calculator

And a bit of quiet time to get the work done.

Can you prepare my VAT form?

If you wish we can prepare your VAT form for you, if you don’t want to do it yourself. Subject to you keeping the basic records.

Please contact us if you wish us to deal with the preparation of your VAT form on your behalf.

For further information, please contact us on 03332 401 333 or email enquiries@kirknewsholme.co.uk