Cash accounting rules updated

Just before Christmas, HMRC released amended draft Finance Bill 2013 clauses setting out further details for the simplified income and expense regime, and transitional rules to restrict manipulations by businesses moving in and out of the scheme.

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Comments

Oh Dear    1 thanks

pauljohnston | | Permalink

And that is a precise of the simplified rules!

Hurrah! I'm still in business!    1 thanks

Briar | | Permalink

Reading the precis (sic), I conclude that there is a future for accountants after all. Taxpayers adopting the cash basis will still need us to interpret the complicated rules. The only problem is that we will have to learn a new way of accounting as well.

One concludes that the civil servants/HMRC have done their job in true "Yes, Prime Minister" fashion ... made a simple concept almost totally incomprehensible in practice.

 

Sounds simple!

The Black Knight | | Permalink

Sounds simple? Should be just as easy to get wrong as before at least.

I am looking forward to doing the "what you could have saved yourself if you had an accountant"

This calculation (in or out) is going to be different for every taxpayer!

It really is time to vote Monster Raving Looney Party.

 

If I have read it right?

I especially like the cars and vans one ? picture a bad year (recession, unlikely I know) Van/car 100% business use leasing costs £4200 fuel £480 insurance £500 repairs £700 total cost £5,880.......4000 miles @ 45p £1,800........... extra tax bill £1,183 just when you needed it.

and will perhaps create some extra work for HMRC when the monthly cash flow figures don't agree to the annual accounts.

This is going to be hilarious.

am I going mad? Quite probably.....

taxinfo | | Permalink

Quote:
deductions will not be allowed for buying or improving assets that are likely to hold their value, namely:

  • cars

WHAT?

 

Since when has a car any of us have ever owned for business use "held" its value or ever likely to?

It;'s all madness

taxinfo | | Permalink

The Black Knight wrote:
hilarious.
Not the word I would have used but I get your meaning.

Basically

The Black Knight | | Permalink

Basically you can pick any basis you like.

Which is no different from taxpayers who do their own returns do now.

The rules to prevent abuse seem very complicated and the mention of no bad debt relief when using the cash basis makes me wonder whether the person writing the rules has any knowledge of accounts whatsoever.

at least the taxpayer should be always be able to claim a reasonable excuse for being confused and getting their tax return wrong. So that's one in the eye for HMRC and their penalties.

Should be able to drive a truck through that one and this should provide a new lucrative source of income arguing with HMRC at tribunal.

Of course the real reason behind this is an increase in taxation for the gullible.