The Practical Guide to Limited Company Tax
If you have chosen to operate your business as a limited com...
By Lynne Gowers on 11th August 2017
The owner-director of a fish & chip shop in Aberdeen has found himself on the hook with HMRC and Companies House for failing to keep proper accounting records.
Keith McGilvray was disqualified as company director for 7 years after an Insolvency Service investigation found he had failed to maintain proper accounting records and caused his company to trade on a cash basis.
His company, Frogfish Limited, of which he was sole director, was placed into compulsory liquidation in June 2016 with liabilities of £94,080, following a winding up petition lodged by HMRC.
Without accurate accounting records for the period under investigation, the authorities could not verify whether receipts were a true reflection of sales and if cheque payments were actually company transactions. In addition the Insolvency Service could not verify the amount paid in wages and resulting PAYE liability owed to HMRC.
Mr McGilvray also failed in his statutory obligations to file annual accounts and VAT returns for the period in question.
The case highlights the importance of understanding the key duties that are part and parcel of being a limited company director.
Your limited company is a legal entity in its own right, completely separate from your personal finances and assets. As director of the company you have certain legal obligations to Companies House and HMRC, including:
While the responsibilities of being a limited company company are yours alone and should not be taken lightly, it helps immensely if you have the right professional support to guide you on your statutory accounting obligations.
Your accountant will help you deal with all of your duties to HMRC and Companies, leaving you to focus on growing your business.
We have put together a simple guide to help you understand and comply with the rules and responsibilities that come with the role of company director. To download this free business guide, just click on the link below:
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