My new client owns a beauty salon and it is 100 percent cash business. She incorporated about 18 months ago without the help of an accountant and never had proper book keeping system in place. However, she has cash register Z reports for the whole year , bank statements and expenses receipts. Now is the time to file CT600. Her sales for the year were around £50,000 and expenses around £22000. Profit of the company is around £27000 after depreciation. She has been using company money (cash in hand) for her personal expenses and only deposited a fraction of total sale proceeds in the bank. Now she wants us to treat £20000 as dividend paid (from cash in hand) in the last month of the accounting period and leave the balance for corporation tax etc. What are the repercussions if her case later on is selected for audit? There are no dividend transactions in her bank statements.
13th Aug 2017
Dividend payments and book keeping records
Paying dividends from cash in hand.
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