Share this content
6

Taxfiler - netting-off assets and liabilities

As we know, netting-off assets and liabilities is only allowed in specific circumstances.

Didn't find your answer?

Hi All,

I raised the following with Taxfiler:

"I noticed that if, for example, a figure in the TB which would normally be a liability is in fact an asset in a given period, Taxfiler still groups it in the SFP as a liability.  That reduces overall liabilities, rather than – per FRS102 (in the general sense) – showing a larger liability and the asset separately.

 

Take the “Corporation Tax Liability” as an example.  This can sometimes need to be a “Corporation Tax Asset”, but there is no TB line under assets for that."

Their suggestion is to raise the point as a suggested improvement (for the development team), and in the meantime use "Other Debtors" instead.

What are AW members' thoughts on this?

Replies (6)

Please login or register to join the discussion.

RLI
By lionofludesch
08th Jul 2020 13:31

Yeah - I just move it to Other Debtors.

Or whatever.

Thanks (2)
Replying to lionofludesch:
Psycho
By Wilson Philips
08th Jul 2020 13:39

Agreed - whereas statutory accounts normally show tax liabilities separately within creditors there is no corresponding entry in debtors so the software is simply reflecting that. Include the asset in other debtors - job done.

Thanks (1)
By Tim Vane
08th Jul 2020 13:39

I believe the issue is to do with the XBRL tags that HMRC provide. Apparently there are tags for tax liabilities but not for tax assets, so software companies use "other debtors" instead.

Thanks (2)
Replying to Tim Vane:
Hallerud at Easter
By DJKL
08th Jul 2020 14:00

Bit tricky re s455 tax and also the rare deferred tax asset.

Thanks (1)
avatar
By Philosophic1
08th Jul 2020 14:59

I must confess perhaps placing too much reliance on the software in the past - insofar as I have entered balances by the correct TB description, rather than whether they are debit or credit balances; so I've allowed Taxfiler to put them in the default place on the SFP.

However, I also know that they were always relatively small amounts and would not have made a material difference. (I've seen much worse from much bigger & more established firms, too.)

As always, thanks for taking the time to respond.

Thanks (0)
avatar
By johnt27
08th Jul 2020 21:34

I think you're only practical issue with this is if an asset is offset in liabilities that would otherwise tip said company over the small company limits if it was correctly classified. I suspect some practitioners gloss over this on the basis of materiality or other reason...

Thanks (0)
Share this content

Related posts