Office 'admin'   The systems that give you control

Accounting for the money but not being an accountant...

Manage your business- don't let it manage you

Accounts. For the Sole Trader

In the UK, the Inland Revenue does not care what system you use to account for your profit, or loss. But, they DO care that you have a system. This gives you a choice and you should choose a system that you are comfortable with and understand. So, you can keep accounts on computer, using proprietory software like Quick Books, or buy one of several book systems, create your own in a standard cash-analysis ledger, or write it all upon the wall in your garage. They only require that you HAVE a system, that accounts for all the money going in and out of your business. And the evidence to support your figures. That evidence includes receipts for everything you buy, copy invoices for every sale ( or a book or electronic record of sales, or till-roll etc.) And bank paying-in-slips, chequebook stubs and bank statements. These all support the figures you produce when paying tax. Keep these records for 7 years.

If you know that you are not going to be able to keep on top of this process, get someone else to do it for you. There are plenty of reliable book-keeping services who will keep it up to date for a modest monthly sum, freeing you up to concentrate on making money. You will use these records to complete your annual tax self-assessment

Accounts.  For a Partnership

After dividibg the net profits of a partnership in the agreed manner, each partner will then account to the Inland Revenue directly for the tax liabilities on his share.

Accounts.  For the Company.

For the small limited company, it is still not necessary to have complicated accounts systems- in fact you should vigorously resist any admin system that is unecessarily expensive or complex. But you must be able to produce comprehensive accounts so that you can get your year-end audit completed without incurring large accountancy charges. The more complete and organised your paperwork is, the less the annual audit fees should be.

In all the above trading formats, advice should be taken from an accountant to minimise your tax liabilities and ensure you comply with the law,before you submit tax returns.

Credit Control

When you give credit on sales made, you will always incur the risk of bad debts. To avoid or minimise these, follow some simple rules:-

Enter up all sales and payments, in your sales ledger, daily!

Decide what your terms will be and ensure your customers know them.

Do not have a lengthy system of statements and reminders. The more time you give, the more people will take.

Chase overdue payments immediately.

Customer Records

Keep detailed customer records. Use a management system ( like Goldmine)if you are computerised, or a card-index system if not. Record the details of the buyer, the business and all transactions made.

Be aware of the requirements of The Data Protection Act when recording customer information. If necessary, register with The Data Protection Registrar. Email:   mail@ico.gsi.gov.uk