Tax on Trusts

Normal accounting is focused on reporting profit or loss of the business and will be governed by GAAP. But Tax accounting is majorly focused on the impact of transactions on tax liability.

Every business including sole traders, partnerships, limited companies and large business will plan for their taxes and make amendments to financial statements and include any past or future tax liabilities through tax accounting entries.

Tax accounting enables and empowers business to comply with tax law and prepare for any future tax liability. Tax Accounting is part of accounting which will be governed by the laws of taxes in that jurisdiction. Apart from tax compliance, tax accounting will help you generate cash flow in real terms. Any future tax liability will be added to cash flow of business in order to save money for future tax payments.

HMRC have published guidance to record income and expenditure on cash basis or accrual basis. They will accept any tax planning which is part of final accounts and is not tax avoidance.

No tax accountant is not more expensive then a normal accountant. We have specialist knowledge and experience to minimise your tax bills.

There is not much difference in the costs. Most of tax accountants will charge for advice and tax planning. Whereas accounting will be the same for every business. The difference is to include tax planning in accounts. 

Your accountant may have included some normal tax provisions. If not you may be able to make adjustments in your current financial year. If you are loosing any tax reliefs, you may need to amend accounts and resubmit to HMRC and companies house.