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Greetings everyone,
I am preparing my books for an LTD’s end of the year and I have encountered a mistake I have made in 17-18 tax year with payroll.
By mistake, when deducting training money from an employee, I have ticked the box to deduct the money from the gross wage, before NI and tax.
I know I can reopen the payslip, correct the error and submit an Early Year Update.
The difference would result in £2.93 Employee NI underpayment that will obviously increase my tax bill for that quarter with that exact amount (I am paying PAYE quarterly)
By doing this I have 2 important questions:
I know I have to pay HMRC straightaway to avoid penalties, but what reference number shall I use? Shall I use the same 17 digits reference number I’ve used to pay PAYE for that period?
This is the most important question:
As I am preparing my books for the end of the year, how can I include the £2.93 payment?
The liability was created last year but the payment will be done in the next year, after the end of the year date.
Thank you
Replies (8)
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Eh? You won't include the payment because it hasn't been made before the year-end. It remains as a creditor in the books until it's paid. What other option were you thinking of?
That is the nature of a creditor. It is something that is owed at the balance sheet date and paid later.
There are many different types of creditor, but unpaid supplier accounts that you mention fall under the heading 'trade creditors'.