What do they mean?

What do they mean?

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Have an enquiry letter from the Revenue.

They require an analysis of drawings distiguishing between cash, cheque and other items.

Do they mean the actual names on the cheques and names of any direct debits?

Also they have this point:

To avoid unncessary queries and duplication of effort, it would be helpful if you could let me have copies of your analyses you made when preparing the accounts to allow me to reconcile return entries with your records.
Si

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By User deleted
10th Nov 2005 18:56

Accountant
Would it not be wise to get professional help on this one if you are unsure of areas such as this.

Enquiry work is quite specialist and as an accountant in practice I've seen so many new clients come to me who would have saved HUGE sums had they only sought professional advice first.

I actually also strongly feel unrepresented tax payers are easy targets for the tax man.

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By User deleted
10th Nov 2005 11:47

Drawings Analysis
What the Inspector is asking for is a breakdown of the money that you have taken from your business in the year.

Some you may have taken as actual cash, some as a withdrawal from your bank account or by another means - such as buying yourself a personal item using a business cheque. The Inspector will want to see that you have recorded all these items correctly and probably also that you have an adequate source of income for how you live.

The second comment just means that the Inspector would like to see your workings you did in preparing your tax return. This is just a request however and not a demand. However it is usually a good idea to be as helpful to the Revenue as possible to help speed up the enquiry and if there are any errors in your return it is more likely the Revenue will accept they are genuine errors if you have been as helpful as you can. If in doubt as to what exactly she is requesting I would give her a call and ask her what breakdowns and analysis she would like in particular.

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By neileg
10th Nov 2005 12:56

Bit obvious
It's an obvious point, but the total of the analysis you prepare should be the same as the entry for drawings in the accounts. It's not going to help if the tax return has shown £10k and your analysis is £9k or even £11k. I think this should be sufficient. That means you will have to include any cash differences, balancing amounts, etc in your summary.

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