mattye
9th March 2009, 09:25
Hi all,
I have an accounts question regarding rebate in tax to employee and how to show this in my Ltd Company accounts. Firstly we are only a two person company and up till now i've done our accounts without any big dramas.
My question is about how you show a tax rebate in your accounts and the affect it has on Profit & Loss sheet.
Up till now I've set up a 'Pot' for each accounting activity. For example a 'pot' for fuel expense, PAYE and IT expenses etc. As a payment is due from a 'pot' then I show a credit from the business account into the pot and then a payment out. This ensures that i account for all monies comming out of the business account.
After using the HMRC employer CD and changing my job I was due a tax rebate which was shown using the HMRC calculators and P11 sheet. The company paid this initially and then claimed the rebate paid back from HMRC. There was no problem and the company received the rebate.
I showed the rebate payment as monies going out of the PAYE 'pot' and so it showed as a 'negative' which was replaced when the rebate was paid and showed as zero. (i.e. monies into the 'pot' was balanced by monies out'.
Because the rebate was not shown as income on the profit and loss sheet I seem to have a difference in what money 'should' be in the business account and what is 'actually' in the business account by the same amount as the rebate.
Have I shown this rebate correctly or does it need to be shown as income into the company?
Sorry its such a long question but I want to give anyone reading this as much information as possible.
Any comments much appreciated.
I have an accounts question regarding rebate in tax to employee and how to show this in my Ltd Company accounts. Firstly we are only a two person company and up till now i've done our accounts without any big dramas.
My question is about how you show a tax rebate in your accounts and the affect it has on Profit & Loss sheet.
Up till now I've set up a 'Pot' for each accounting activity. For example a 'pot' for fuel expense, PAYE and IT expenses etc. As a payment is due from a 'pot' then I show a credit from the business account into the pot and then a payment out. This ensures that i account for all monies comming out of the business account.
After using the HMRC employer CD and changing my job I was due a tax rebate which was shown using the HMRC calculators and P11 sheet. The company paid this initially and then claimed the rebate paid back from HMRC. There was no problem and the company received the rebate.
I showed the rebate payment as monies going out of the PAYE 'pot' and so it showed as a 'negative' which was replaced when the rebate was paid and showed as zero. (i.e. monies into the 'pot' was balanced by monies out'.
Because the rebate was not shown as income on the profit and loss sheet I seem to have a difference in what money 'should' be in the business account and what is 'actually' in the business account by the same amount as the rebate.
Have I shown this rebate correctly or does it need to be shown as income into the company?
Sorry its such a long question but I want to give anyone reading this as much information as possible.
Any comments much appreciated.