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Keeping accounts is a crucial business management tool. If you are not on top
of the financial paper work in your company, you will not have a chance to guide
your company properly.
Keeping accounts
Keeping accounts must also comply with your country´s legislation on VAT,
Sales Tax and other settlement.
When you are running a company you must keep annual accounts providing
information on all financial activities in your firm.
- Accounts must be kept on a regular basis and must be well documented with
vouchers (invoices, receipts, pay slips, statements, etc.).
- Vouchers must be filed for five years.
- You do not have to keep the
accounts yourself, but you are responsible for the keeping.
As a side effect from this work, you will be able to calculate the annual tax base and currently keep track of your VAT payable.
Annual Accounts
Annual accounts must be kept in such a way that it is clear to the Tax
Administration how you have reached the figure for the profit of your firm.
Being a sole trader you obviously have to pay income tax on your profit.
This is how you make the annual accounts:
Total sales of the year / turnover
- less the company’s total expenses
= The company’s profit, which is your wage.
Companies are also liable to tax, although the calculation differs from that of
an ordinary taxpayer’s.
If you have proper accounts you can retrieve proper financial statements.
- Go to next
business issue: Financial Systen Illustrated
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Copyright © 2009 Dynamic Business Plan 07-02-2012
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