new financial year

COOLTRIKERCHICK

i know this is going to sound totally dumb....:rolleyes:

but when do you start your new financial year is it on the 6th of april? or can you do it on the 1st ?

why i am asking up until now i have been logging eveything into a book.
but a few weeks ago i bought a basic programme called quick books 2008, as i going to put everything on the computer... i am going to use it from the start of this financial year, for me it owuld be easier if i could start from the 1st of april,

fengirl_2

Your financial year normally ends on the day before your businesss started. So. if you started on 1 July 2007, your year end would be 30 June 2008. However, you can choose whatever date you want and if you want 1 April, then you can. The only accounts which have to end on 5 April are for letting income.

COOLTRIKERCHICK

ok thanks....dont know why i thught that then.... as i remember hubby doing a shorter financial year, so it would bring it in line with the financial tax year....

as i officially started june last year, i thought i would do a short year, so it might be easier....

richt71

You can change the date of accouns for a Ltd company by contacting companies house. But if you've not changed it it runs year to year from formation. Obviously a sole trader works the same as the national tax year.

fengirl_2

With respect to richt71- no, a sole trader does not work in line with the tax year - as I have said above, you choose your own accounting year.

vivatifosi

Hi cooltrikerchick,

I started trading in September, but found it way easier to bring both my VAT quarters and trading year into alignment with the tax year. Well worth doing, and I found HMRC very helpful.

taxdoctor

Can only echo what Vivatifosi has said.

There is no requirement to make your accounting date the same as the tax year (5th April) but it will certainly help things. Especially in the earlier years.

Your first assessable period with HMRC should be from the date you started up until the 5th April. So if you prepared your accounts to that date it would tie in.

If you prepared your first set of accounts for a full year and did them in June then you would not have an accounting date falling within the 2007/08 tax year. You would therefore have to provide provisional figures for the 2008 year up to the 5th April. They would then have to be amended when you knew what the actual figures were.

Plus there are other issues such as overlap.

If you're unsure consult a local accountant! If you're set on doing it yourself my advice would be to pick the 5th April as your accounting year end!

COOLTRIKERCHICK

thanks tax doctor... it would be easier, and then i will know where i am so to speak... why i though the 1st of april was because. on the 5th of april, the rent, loan money etc comes out of the bank...

but 6th april will be a lot easier for me....

thanks...

Savvy_Sue

I was discussing this with our church treasurer the other day, who with his professional hat on also audits the charity I work for.

He was saying he has just changed the church's financial year FROM being the same as the tax year TO ending on 31 March, because it makes year on year comparison so much easier!

For example, much of the church's income comes in on Sundays, and a fair few people give monthly. So if they always give on the 1st Sunday of the month, sometimes there will be 13 1st Sundays in the tax year, and sometimes only 11. If you're trying to compare income for a '13' year with an '11' year, it raises questions which are avoided if you just end the year on 31 March.

He also said he was about to start using QuickBooks for the church's accounts, and that seems to 'work' better using month end rather than 6th April - I think that's what it defaults to when you're reconciling, for example.

However, one thing he said made me think that if ever I run a business again my year end will NOT be 31 March. His company audits I think over 100 sets of charity accounts, and they ALL end their year on 31 March - except the charity I work for!

So, everyone is scrambling to get their accounts into order and phoning the accountants with queries.

Whereas we have another month in which to get organised! Which is just as well as we've had a dreadful month admin-wise!!!

Now, it does cause SOME problems: a colleague wants information on expenditure in a certain class from March to March, and sometimes we want information for the calendar year, but you could have the same problems whenever your year end was.

Also you can have a 'short' first year if you want to have your financial year ending at a particular time - say if you always have a slack period, you might want to end your year just before that to give you time to sort out queries with the accountants, rather than being rushed off your feet AND trying to finalise your books.

COOLTRIKERCHICK

thanks sue.....i am hoping i can do a self assessment so to speak, as its only me ..lol... so it is basic ins and outs and general expenditure...rent... diesel...etc....

the quickbooks programme i bought was reduced in staples to half price... plus i had a £10 voucher through the post from them, so in effect only cost just over £14

Savvy_Sue

COOLTRIKERCHICK wrote: »

thanks sue.....i am hoping i can do a self assessment so to speak, as its only me ..lol... so it is basic ins and outs and general expenditure...rent... diesel...etc....

the quickbooks programme i bought was reduced in staples to half price... plus i had a £10 voucher through the post from them, so in effect only cost just over £14

Oh a PROPER bargain then! :rotfl:

BTW, we're using QuickBooks at work, and although we find it's good, it's taking us a long while to get to grips with it properly. We started trying over a year ago, but the person we had in to train us took us SO slowly, it was a complete nightmare: she'd been in 3 times and we still didn't know how to record our income!

We've now got someone else coming who is much much more helpful, he's showing us the basics, in the order we want to see it, then letting us come back with any queries, and phoning us regularly to check if there are any problems.

We've also bought ourselves QuickBooks for Dummies.

BTW, you might be able to teach yourself QB, but you'd have to be single minded about putting the time aside for it. In our organisation there's always something more urgent happening to interrupt us, whereas if our colleagues can see the trainer is with us, they leave us in peace.

Hmmm, maybe we need a cardboard cutout to sit in the spare chair ...