To assess your business’s tax obligations, the government relies on a range of documents. The two most important are your:
- profit and loss (P&L) statement
- balance sheet
Simplifying P&L statements for end of financial year
Your accountant needs a really comprehensive and accurate record of transactions to get P&L statements right for you. You can help them by:
- using only business bank accounts to pay business bills
- getting online accounting software that retrieves transaction data straight from your bank
- staying on top of bank reconciliation so income and expenses are correctly classified
Simplifying your balance sheet for end of financial year
It’s best to stay on top of your assets and liabilities throughout the year, rather than trying to catch up at financial year end.
- Record new assets as soon as they come into the business, so nothing’s forgotten.
- Make sure you record bills as soon as they’re received (not just when you pay them).
- Use invoicing software that shows what has and hasn’t been paid.