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Meticulous bookkeeping is the linchpin to ensuring you have clarity on the financial performance of your business. There are many reasons why the value of efficient bookkeeping shouldn't be underestimated so it's wise to make sure that, no matter what is going on in the world, you give your business bookkeeping a regular once over. However, during these unstable and challenging times you might be thinking about the best ways to invest your time and energy so that your business stays on track. Here we discuss some of the finer details of bookkeeping and why keeping them up to date is more important than ever.
Your staff are important to ensuring your business runs smoothly so paying them correctly and on time is imperative to keeping the cogs turning. Maintaining your payroll accurately will enable you to have a clear vision of your overall salary outgoings, including any PAYE owed and pension contributions.
Payroll also serves as a highly important record should you need to place any member of your team on furlough or unpaid leave. For example, if you have applied to claim for employees' wages through the Coronavirus Job Retention Scheme, or you want to recoup an employee's Statutory Sick Pay, you will need to provide accurate records of the employees you intend to claim for. Payroll can be an extremely time consuming and highly detailed process so having support from a professional bookkeeper is always worthwhile.
For companies that pay VAT or individuals who complete a Tax Self-Assessment, good bookkeeping is imperative to making sure that underpayments, or indeed overpayments, don't get made. If your company is part of the Making Tax Digital for VAT scheme then you will already be required to keep and send your VAT returns using approved software.
However, this is not the same as filing your tax returns online and requires more regular updates of tax information. If your business has been affected by coronavirus, and you have VAT payments due between 20 March 2020 and 30 June 2020, you can defer your VAT payment to a later date. Likewise, for those who are due to make a second payment on account for their Self-Assessment, you can delay this until 31 January 2021.
Knowing what is coming in and going out of your business is essential. If you need to make decisions about finances it is crucial you are fully informed of your expenditure so you can choose where to cut back if necessary.
It is also important in the event you want to verify the viability of your business should you require a business loan in the future. This includes the government's Coronavirus Business Interruption Loan Scheme, which helps small and medium-sized businesses affected by coronavirus to access finance of up to £5 million. To be eligible, businesses will need to provide a borrowing proposal which the lender would consider viable. Therefore, up to date and accurate books are highly valuable to successfully obtaining this.
Here at AMR we are experts at helping businesses of all sizes with their bookkeeping and payroll requirements, including managing payroll, VAT and Self-Assessment. If you have any questions or need professional bookkeeping advice, our friendly team will be happy to assist you. Get in touch and find out how our specialisations can help you and your business.