Sales Revenue

Discussion in 'Accounts & Finance' started by Nat75, Feb 14, 2020.

  1. Nat75

    Nat75 UKBF Newcomer Free Member

    1 0
    Is it possible to calculate sales revenue on the cash basic ( paid invoices instead of issued invoices in accounting period ) ? If yes what about irrecoverable debts ? Logically yuo can't write off any unpaid invoices in this situation - am I right ?
    I am asking as our new accountant says that you always pay corporation tax on paid invoices not issued and I think she is wrong...
     
    Posted: Feb 14, 2020 By: Nat75 Member since: Feb 14, 2020
    #1
  2. intheTRADE

    intheTRADE UKBF Regular Free Member

    266 77
    I am no expert so someone may correct me, but as I understand it issued/unpaid invoices need to be shown in your annual accounts so profit isn't overstated but you do not pay corp tax on them.
     
    Posted: Feb 14, 2020 By: intheTRADE Member since: Apr 14, 2019
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  3. Caspar

    Caspar UKBF Newcomer Free Member

    226 40
    From HMRC see the below link.
    https://www.gov.uk/simpler-income-tax-cash-basis/who-can-use-cash-basis
    ________________________________________________________________
    It states
    Who can’t use the scheme
    Limited companies and limited liability partnerships can’t use cash basis.

    Who can use cash basis
    You can use cash basis if you:

    • run a small self-employed business, for example sole trader or partnership
    • have a turnover of £150,000 or less a year
    If you have more than one business, you must use cash basis for all your businesses. The combined turnover from your businesses must be less than £150,000.
    ________________________________________________________________

    I wonder if you are thinking about the VAT Cash Basis, which is something totally different and permissible, where VAT is only paid over when the invoice has been paid.
     
    Posted: Feb 14, 2020 By: Caspar Member since: May 23, 2013
    #3
  4. MyAccountantOnline

    MyAccountantOnline UKBF Legend Full Member

    12,943 2,406
    I'd go back to your accountant and ask for clarification.

    If it's for company accounts it is all sales earned in the period ie all sales invoiced with an adjustment for work in progress.

    If you have bad debts they are written off as an expense.
     
    Posted: Feb 14, 2020 By: MyAccountantOnline Member since: Sep 24, 2008
    #4