missing invoices - a problem? (self employed)

catoutthebag

I work self employed for 3-4 companies mainly.

I keep invoices in paper copy in am a4 binder in order.

If i'm missing invoices (but still have the income declared on my return), is this a problem in terms of if her majesty investigates me?

All payments go into my current account. If I took the time, I could probably attribute the missing invoices to various incoming payments on my bank statement - but would be a little laborious.

I could contact the usually slow/usually useless payment departments for reprints. ..but would take Some pleading and chasing and waiting.

Is it worth the hassle? I'm just a bit anal with having stuff in order and always weary of investigating (how far does her majesty investigate anyway)

Thanks

PlutoinCapricorn

There is no harm in asking your client for a copy of the invoice you sent. You could also prepare your own copy again. I do mine in Word, and send them to my clients by email. I write the reference number next to the credit amount on my bank statements. I also keep a spreadsheet listing all invoices I issue, the date issued, the paid date, the amount etc. I have never been contacted by HMRC and probably never will be, but all my records are in order just in case.

If HMRC ever did make an enquiry, you should be able to match payments with your records.

TheCyclingProgrammer

HMRC would be unlikely to make an issue of this IMO, beyond maybe telling you to take better care of your records. You are declaring the income so there is no tax loss here.

Presumably you have an entry in your books for the sales? That should be sufficient.

It might be more serious if you were VAT registered but even then, as long as you had properly accounted for the VAT it should be OK.

Why not just keep digital copies of the invoices instead? Presumably you are generating invoices electronically and not hand writing them?

zygurat789

TheCyclingProgrammer wrote: »

HMRC would be unlikely to make an issue of this IMO, beyond maybe telling you to take better care of your records. You are declaring the income so there is no tax loss here.

Presumably you have an entry in your books for the sales? That should be sufficient.

It might be more serious if you were VAT registered but even then, as long as you had properly accounted for the VAT it should be OK.

Why not just keep digital copies of the invoices instead? Presumably you are generating invoices electronically and not hand writing them?

They are not keen on there being no independent verification and they may make an issue of it if they find other weaknesses.

Pennywise

If you don't have copies of your own invoices, how do you know for sure that you've been paid?

Especially since you mention your customer is "slow" and "useless".

Your risk of your poor record keeping is more than worrying about tax inspectors - the bigger risk is never seeing money that you are owed.

PlutoinCapricorn

That is why I keep a master spreadsheet listing the details of all invoices issued with dates paid - not that I have ever not been paid!

Pennywise

PlutoinCapricorn wrote: »

not that I have ever not been paid!

You'd be surprised. I've seen it loads of times. The worst was an IT consultant who invoiced 4 weekly. When I was doing his year end, I noticed only 12 instead 13 payments. Client was adamant that he had been paid and couldn't have possibly missed one as he "had his own system", but when presented with the dates and amounts, he had to concede he had missed one. The amount was just over £8,000!

chrismac1

I concur. As well as missing receipts, I have had two clients where I have identified that they had paid suppliers twice! Their previous accountants had missed this, so when the suppliers concerned repaid these material amounts I was off to a good start.

My general guidance on missing paperwork follows:

Ideally paper invoices are available for inspection. But unlike HMRC most of us now live in the online world of the 21st century, not the 19th. The good news is that HMRC have lost several cases where there was not a "paper trail" but there was strong other evidence. So if, for example, you have a bank payment to "X Limited" but no invoice in your file from "X Limited", you are on solid ground. One Tribunal judge even went on record as saying "Why did you bring this case, HMRC?"

catoutthebag

Let me clarify

All companies email the invoices to ME. This is how the profession I work in works. Blanket practice.

I then print these off and into a binder so I have a dual record.

Only one of the companies posts them out.

Plus I have a diary record of where I worked and what I was paid.

Plus I keep my own excel sheet detailing everything (date, hours, rate, pay, mileage, company).

I will have been paid. It's automatic bacs. I've never not been paid. I usually cross check my bank.

Just some of these paper copies from the one company are missing from an otherwise pretty complete record.

So having said that...do I chase it up or leave it?
(Ps not just for 13/14 but thr odd few invoices from hundreds from 2008, again all other records complete)

catoutthebag

I should add given what some here do

I do not add the date on thr invoice from the company nor the date I was paid into the excel sheet

Maybe I should in hindsight but I'm not going to start now as it would not look linear and I probably have mild ocd with that

It's literally date company hours rate mileage total pay. This is sufficient I think.

This post is a thinking out loud add on.

Cook_County

What kind of self-employment is this? It is a practice I have never heard of, it sounds much more like employment than self-employment.


I assume you number your invoices sequentially so you can see which are missing or unpaid?