The cost of bad record keeping

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Are you aware of the costs associated with not keeping sufficient records?
Tax Forms

Your company or organisation must keep sufficient business records to allow you to file a complete and accurate Company Tax Return.

If your company or organisation does not keep these records, it may be charged a penalty of up to £3,000. Generally HMRC only charges this type of penalty in serious cases - for example, where no records have been kept, records have been deliberately destroyed, records are proven to have been falsified or your company or organisation has a history of failing to keep certain records.

Without proper records, it will also be very difficult to get your Company Tax Return right. So your company may also risk being charged penalties for filing an incorrect return.

If your company is registered at Companies House, you must keep and retain certain accounting records showing your company's transactions and its financial position. You have to do this even if your company is not currently trading or no longer trading. These records include:
    • a record of your company's assets, for example, a record of 'capital expenditure' such as the purchase and sale or disposal of company assets, equipment, office furniture and vehicles
    • a record of your company's liabilities
    • a record of your company's income and expenditure
    • details of any stock on hand at the end of your financial year
Generally, if your company keeps these records, you will not need to keep any more for Corporation Tax.

For companies with an active fleet, fuel expensed through the business must be supported by accurate and legitimate documentation of mileage. In this day and age, all but the most archaic of businesses run electronic accounting and bookkeeping software. When it comes to your fleet, why choose to live in the dark-ages and risk using paper or manual records? Take a look at ABAX's range of fleet management solutions that keep you one step ahead of the tax authorities.

Do you want to know more about being HMRC compliant? You can see a list of HMRC penalty sanctions here or speak to ABAX today on 01733 69 88 88 .