by Pi Accountancy | Sep 17, 2024 | Advisory and Resources, Business, Frequently Asked Questions, Taxes
Capital Gains Tax (CGT) applies when you make a profit after you sell or dispose of an asset. However, CGT only applies to the gain, not the total amount you receive. For example: You buy a painting for £5,000. Later you sell it for £25,000. You have made a £20,000...
by Pi Accountancy | Sep 5, 2024 | Frequently Asked Questions
What are HMRC Penalties? HMRC imposes penalties on taxpayers who fail to comply with their tax obligations. Consequently, these penalties serve as a deterrent to non-compliance and encourage everyone to adhere to tax laws. If you don’t file your tax return on...
by Pi Accountancy | Aug 28, 2024 | Frequently Asked Questions
What is a Cash Flow Statement? A Cash Flow Statement outlines the inflows and outflows of cash and cash equivalents in your business. It provides insights into your company’s liquidity by covering debts and operating expenses without additional financing. Unlike...
by Pi Accountancy | Aug 28, 2024 | Frequently Asked Questions
What is an Income Statement? An Income Statement, also known as a Profit and Loss Statement (P&L), summarises a company’s income and expenses over a specific period. It provides a snapshot of a business’s financial performance and is essential for...
by Pi Accountancy | Aug 27, 2024 | Advisory and Resources, Business, Frequently Asked Questions, Regulations and Schemes, Software
A Balance Sheet is a financial statement that lists a company’s assets, liabilities and equity. It shows the financial position of a business on a specific date. Most businesses prepare balance sheets monthly, quarterly or annually. A Balance Sheet forms one of...
by Pi Accountancy | Aug 22, 2024 | Advisory and Resources, Frequently Asked Questions, Payroll and Employment, Taxes
A P45 is the document you receive when you leave a job. It provides a clear summary of your earnings and the tax you have paid during the current tax year. Your employer must provide this document when your employment ends. This applies whether you resign, retire or...
by Pi Accountancy | Aug 21, 2024 | Advisory and Resources, Frequently Asked Questions, PAYE, Payroll and Employment, Taxes
A P60 is an end-of-year tax summary. Your employer provides it after the tax year ends. The tax year runs from 6 April to 5 April. This document shows how much you earned and how much tax you paid. It brings together all important figures from the year in one place....
by Pi Accountancy | Aug 20, 2024 | Advisory and Resources, Frequently Asked Questions, PAYE, Payroll and Employment
A P30 is a document that shows employers how much tax and National Insurance they owe for a specific period. Employers send this document alongside their payment to HMRC. Moreover, employers collect the required tax and National Insurance from employee wages. Read...
by Pi Accountancy | Aug 15, 2024 | Frequently Asked Questions
What is an Accounting Journal? An accounting journal is a record where businesses document their financial transactions in chronological order. This process is the first step in the accounting cycle and is crucial for accurate financial reporting. Accountants and...
by Pi Accountancy | Aug 14, 2024 | Frequently Asked Questions
What is an Accounting Ledger? An accounting ledger records all financial transactions organised by account. This ledger records every financial move made by the business, providing a comprehensive view of its financial health. Think of it as the backbone of a...
by Pi Accountancy | Aug 13, 2024 | Frequently Asked Questions
What is an Accounting Period? An accounting period is a specific timeframe for which a business prepares its financial statements and reports. The purpose of an accounting period is to provide a consistent basis for measuring and reporting financial performance. This...
by Pi Accountancy | Aug 6, 2024 | Frequently Asked Questions
What is a Business Bank Account? A business bank account specifically manages the finances of a business. Unlike personal bank accounts, business bank accounts offer features tailored to business needs, helping you to manage income, expenses, and financial...
by Pi Accountancy | Jul 16, 2024 | Frequently Asked Questions, Self Assessment
HMRC uses the Self Assessment system to collect Income Tax and requires taxpayers to complete a yearly tax return. Self Assessment is for those who do not have their taxes automatically deducted from their earnings or for those with additional income sources....
by Pi Accountancy | Jul 11, 2024 | Frequently Asked Questions
Does Tax Apply to Marketable Securities? Yes, tax does apply to Marketable Securities. Marketable securities quickly and easily convert into cash due to their high liquidity. Common stocks, treasury bills, and bonds, traded on public stock exchanges, are examples of...
by Pi Accountancy | Jul 10, 2024 | Frequently Asked Questions
What is Football Transfer Tax? Football Transfer Tax refers to the tax implications and regulations surrounding the transfer of football players between clubs. There is no specific tax but rather various tax considerations that come into play during the process of...
by Pi Accountancy | Jun 28, 2024 | Frequently Asked Questions
What is the VAT Flat Rate Scheme? The VAT Flat Rate Scheme (FRS) simplifies the way small businesses manage their VAT payments. Instead of calculating the VAT on every transaction, businesses pay a fixed rate of VAT to HMRC – depending on the industry. Key...
by Pi Accountancy | Jun 26, 2024 | Advisory and Resources, Corporation Tax, Frequently Asked Questions, Taxes
Corporation Tax is a tax that companies and certain organisations pay to HMRC on their profits. You calculate it for each accounting period, which usually matches your financial year. However, your first year can include more than one accounting period. Unlike many...
by Pi Accountancy | Jun 18, 2024 | Allowances, Frequently Asked Questions
What is Marriage Allowance? Marriage Allowance is a government initiative aimed at reducing the tax burden for married couples or civil partners. This scheme allows one partner to transfer a portion of their unused personal tax allowance to their spouse or civil...
by Pi Accountancy | May 30, 2024 | CIS, Frequently Asked Questions
The Construction Industry Scheme, or CIS for short, is a tax deduction system which ensures that contractors correctly handle tax payments for subcontractors. The scheme help regulate tax compliance and prevent tax evasion by requiring tax deductions at the source....
by Pi Accountancy | Jun 1, 2023 | Frequently Asked Questions
What Business Expenses can I Deduct? As a business owner (or small business owner) in the UK, you are allowed to deduct certain business expenses from your taxable income, reducing your overall tax bill. However it is important to note that not all expenses are...
