If anybody owes you money, then today, which is Friday 31 May 2019, would be a good day to send them a statement to remind them of the fact. This is just a statement which you are entitled to send: it is not a threat.
Archives for May 2019
The Cheque Run round about Tuesday 28 May 2019
It is quite common to invoice a customer with terms of “30 days or nett monthly account”. Small customers will be expected to pay within 30 days, while large customers will be expected to pay at the end of the month following the month of the invoice, so an invoice sent in April 2019 would be settled by Friday 31 May 2019. Obviously, the average settlement time will be 45 days, but this is OK if the customer’s credit is good.
Large companies insist on doing it this way because they may receive several invoices from a supplier during a month, and will want to settle all of them with a single payment when they do their monthly computerised cheque run. It would therefore be a good idea for the supplier to have sent a statement at the start of May listing all outstanding invoices. Typically the cheque run would be about the 25th of the month, or Tuesday 28th this month.
If you give credit and have debts to collect, then you might like to have a discussion with us. Most accountants are also general business advisers as well. Some large companies rely upon a cynical calculus of bargaining power when they take ages to settle invoices, and you need to know what to do about this.
The “nett” in “nett monthly account” has “net” as an alternative spelling.
An Adjustment to Our OCR Position
Suppose we have a client who hands us 24 bank statements at the year end. We have a working optical character recognition system which can process these rapidly. Sometimes the narrative on the statements will be useless, so we will need to type it in. We have a narrative prediction and overtyping system which can speed things up.
This system is very useful for an elite of experienced accountants to use, but what about junior trainees? Suppose that the client registers for VAT, and starts bringing in 6 bank statements per quarter? Suppose that some statements are torn and won’t go through the scanner? Suppose that there is a queue to use the OCR scanner, or suppose we just cannot be bothered?
To simulate the likely usage of OCR in a typical accountant’s office, we are going to prohibit the use of OCR for runs of less than 7 bank statements. We will then be forced to type it all in, but we can still use narrative prediction and correction. In addition, with smallish batches of 7-11 bank statements where we do use OCR, we are likely to scan dates and numbers only, and use narrative prediction for the narrative.
This will encourage us to develop a balanced OCR system which is not just a fair weather friend. Our alternative systems will be inspired by seeing an OCR system in action, and will be designed to be almost competitive with it. We will have an OCR-equivalent level of ambition. Tactically, we will be slightly less competitive, but strategically, we will aim to be better and are likely to succeed.
Value Added Tax deadline on Friday 7 June 2019
Value Added Tax returns for the quarter ended 30 April 2019 should be submitted by Friday 7 June 2019, and any payment which is due should be made electronically by the same date.
Issue P60s by Friday 31 May 2019
The deadline for issuing P60s to employees for the tax year ended 5 April 2019 is by Friday 31 May 2019.
Ahem, we issued the P60s for all our clients’ employees over a month ago and we are now well into the P11D cycle which we started on 6th May.
Companies with a 31 August 2018 year end
When You’re Not Fishing …
… you should be mending your nets. This is a position that the self-employed are often in. You need to be active on something all the time. Normally either you are doing the job, or you should be out prospecting for new business.
In our case we have VAT returns and company accounts which keep us busy all the time. In some months there are fewer VAT returns to do, and we compensate for this by doing a bit more direct mailing of potential clients. Get the idea?
We don’t do any direct mailing in January because we are so busy, but we play catchup in February.
Employer Payment Summary by Sunday 19 May 2019
It can happen sometimes that when you are an employer, you have not actually made any wage or salary payments for a PAYE month such as the month from 6 April to 5 May 2019. In that case you must submit electronically an Employer Payment Summary as a NIL return by Sunday 19 May. This bureaucratic requirement is too easy to overlook.
If you engage a local accountant and business adviser or a payroll bureau to do your wages, then this will be taken care of. In our case we keep a diary and do a batch of payrolls at about the same time each month. Our payroll files are bright yellow like the old P30BC booklet so we do not overlook them. We colour-code all the taxes so green is VAT, red is income tax, blue is corporation tax and yellow is PAYE.
If you no longer want to have a payroll scheme, then you need to close it down in a formal way. You cannot just assume that you can stop sending in monthly returns.
P11D Season Starts
For all our clients, we have now closed down last year’s payroll with a final Employer Payment Summary and have sent P60s for all employees.
We have started doing this year’s payroll and all our clients have had at least one payslip which is in a new colour for the new tax year. We have just put in the Employment Allowance claims (or non-claims) for everybody.
We are now turning our attention to the P11D returns, which need to be submitted by July 6th. We will prioritise any client employer with a credit balance on their PAYE account, which can fund any P11D Class 1A contributions that may be actually due. After that we can claim the refunds, usually by asking for a transfer to credit the corporation tax account, which is the point of prioritising them.
CIS Returns to Sunday 5 May 2019
Construction Industry Scheme returns for the month from 6 April to 5 May 2019 should be submitted online by Sunday 19 May. This includes NIL returns.
It is only too easy to get caught out by the need to submit a NIL return when no payments to subcontractors have been made. If you engage a local accountant to do your CIS returns, then this will be taken care of. In our case we keep a diary and do a batch of work at about the same time each month. We aim to be the Carlisle accountants that businesses will turn to for a range of advice and services. Our payroll files are bright yellow so they are hard to overlook, and CIS files also have a green line around them so they are easy to pick out.