10 Fun Facts about Accountancy!

I regret that there is some stigma surrounding my profession in that is thought by some people to be boring.  I’m here to tell you that is far from the truth and I have some fun facts to help prove my case:

  1. The word ‘accounting’ comes from the French ‘compter’ meaning to count. Other accountancy terms are of Latin derivation, such as ‘debit’, meaning he owes, and ‘credit’ meaning he trusts.
  2. Accounting has been around for a very long time indeed! Tokens dating back 7,000 years have been discovered in ancient Mesopotamia, modern day Iraq, Turkey and Syria.  They are believed to be the earliest records of goods received and traded.
  3. St Matthew the Evangelist is the patron saint of accountants. He has the same role for bookkeepers, tax collectors, stockbrokers and bankers.
  4. Bookkeeper and words deriving from it are the only words in English with three consecutive double letters.
  5. Luca Pacioli, an Italian mathematician, is recognised as the father of accounting. He published the first book on double entry accounting in 1494 and Leonardo da Vinci was one of his students.
  6. Chicago crime boss, Al Capone, was brought down thanks to accountants. He was suspected of many crimes, including bootlegging and murder, but was eventually convicted for tax evasion.
  7. Bubble gum was invented in 1928 by an accountant. Walter Diemar was the man responsible.  The reason it is pink is that this was the only colour dye he had available at the time.
  8. Rock singers Mick Jagger and Robert Plant, together with comedian Eddie Izzard, all worked in accounting before their show business careers took off.
  9. Accountants play an important part at the Oscar ceremonies. Ever since 1935, a team of accountants has spent an average total of 1,700 hours the night before the ceremony counting the Academy Award ballots by hand.
  10. Monty Python often ridiculed members of the profession and this may be because John Cleese’s father wanted him to join a firm of accountants in Bristol.

So, not boring at all!

MTD for VAT Compatible Software

As you may be aware, HRMC are moving towards all tax returns becoming digital.  They are calling the scheme Making Tax Digital and the first step concerns VAT.

From 1st April 2019 all businesses with sales over the VAT threshold which are registered for VAT are required to file their VAT returns with HRMC using MTD compatible software.

So what software will you need?

There are essentially two different types:

  1. A compatible software package that allows you to keep digital records and submit VAT returns
  2. Bridging software that connects non-compatible software which you may already have, such as spreadsheets, to HRMC systems

HRMC have provided a search service to enable you to find the right compatible software or bridging software for you.  You can access it here.

Once MTD for VAT has been finalised and is working HRMC intend rolling it out for Income Tax and Corporation Tax.  There are no firm dates for implementation of these schemes yet, though they are likely to be brought in during 2020.

If you are experiencing any difficulty with MTD or just want to talk through your options, do feel free to give me a ring on 01594 842 188.

Countdown to Self-Assessment Deadline!

It is that time of year again and the deadline for filing your tax return is looming – if you are unsure it is 31st January.

So do you need to file a tax return?  You do if, during the last tax year (6th April 2018 to 5th April 2019), you were self employed as a sole trader and earned more than £1,000.  You must also file one if you were a partner in a business partnership or a director of a limited company whose income was not taxed at source and/or you have further tax to pay.

In this digital age it really is pretty straightforward.  Everything can be done online at HRMC.  You will need to register with them if you have not done so before.

Before you start make sure you have your UTR (unique taxpayer reference) and your National Insurance number to hand.  You may also need bank and building society statements together with your profit and loss accounts and any other business records that might be relevant.

The online form is divided into these sections:

  • Section 1 – your personal details
  • Section 2 – here you enter your income and gains from various sources such as self-employment
  • Section 3 – enter income from bank or building society interest, pensions, share dividends and benefits
  • Section 4 – any other relevant information such as student loans, pension contributions etc

Don’t forget that you can deduct any allowable costs incurred in the running of your business, such as heating, lighting, rent, rates, relevant professional fees, cost of protective clothing and the like.

Do make sure you get your tax return in on time.  There are penalties if you don’t!