Having successfully received the £250 tax-free payment for PAYE online filing 2004/05, how should a limited company actually account for this income which is clearly unrelated to its trading! We run several payrolls for our small corporate clients, and this is going to be a problem in all cases. Help!
Prue Stopford
Replies (2)
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HMRC's advice is:
We recommend that you show the tax-free payments in your financial accounts as 'other operating income'. The payments are not taxable (wherever you show it), so your Self Assessment or Corporation Tax computations should show profit reduced by the payments included in your accounts.
Neil.