My question is pretty much as it says in the title. Most businesses such as pubs, restaurants and shops produce a daily Z reading from their till. But is this a legal requirement?
I've been in numerous places, mostly independent restaurants, where the bill is hand written and the cash kept in a locked tin. As far as I can tell, there isn't even a till. So surely they can't produce a Z reading each day.
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No it's not a legal requirement, but it's obviously good business practice. Do you know someone who has the system to do it but chooses not to?
Why not?
The Z report is a very useful device to "prove" a business' takings and the tax inspectors are accustomed to asking for them. It looks dodgy if a business doesn't keep them - why wouldn't you? One of the main aspects of having a decent till is to prove takings and control income, especially cash. If the till cash is properly balanced and it's reports are properly reconciled against bankings and expenses, then it's a really good bit of evidence that the takings are being recorded accurately. That's good for you as you can more easily send the tax inspector packing!
A tax inspector is far more likely to delve deeper into a business that doesn't have good control of their takings, especially if cash is involved. Nothing more exciting for a tax inspector as there is immediate doubt as to the reliability of whatever cash sales records are kept, so more likely to lead to a business-economics exercise especially if the margins look low or the proprietors drawings look unrealistic.
No, there's no legal requirement to keep Z reports, just like there's no legal requirement to have a till, but done properly, a till protects your income, controls and monitors staff, and is a massive benefit if your records are challenged by a tax inspector. I just can't see why you wouldn't want to keep them for your own benefit!