05 Jan Our Top Five Bookkeeping Tips for Coaches
With another self-assessment deadline gone, now is a good time for coaches to review their bookkeeping records to ensure they won’t have any problems if they are chosen for a tax inspection by HMRC.
Here are our top five bookkeeping tips for coaches to get the new financial year off to a good start.
Keep Good Bookkeeping Records
Make sure your bookkeeping records are up to date and detailed enough to satisfy a HMRC (Her Majesties Revenue and Customs) tax inspector. Clubs usually do this very well but some coaches do struggle.
Use a spreadsheet or computer package to record each and every person who has paid you (if you are running pay and play sessions, one entry for the total taken will suffice as the register will show who was there) throughout the year, together with copies of your (original) receipts for expenses you are claiming.
Get into the habit of doing your bookkeeping on a weekly basis. Go through your diary for the week and record your income and expenses into your spreadsheet. You may get less than 30 days notice of an inspection so don’t let your bookkeeping get too far behind.
Store your receipts in a easy to review format (NOT in a shoe box!) so that any inspection can be done easily and quickly. Keep all associated documents (bank statements, receipts, invoices, cheque and deposit books, etc. You are required to keep a minimum of six years’ worth of bookkeeping records.
Claim for Business Expenses Only
Ensure that you are only claiming for business expenses and that you are claiming a ‘reasonable’ allowance for anything that may be a mixture of personal and business use. Remember that travel from home to your principal place of work is not allowable.
Sports clothing will only be allowable if it qualifies as uniform, i.e. it is branded with your business name/brand. Make sure you can justify any claim for use of home.
Know your Worker Status Options
If you pay other people to work for you, it’s very important to know about the different ways you can pay for someone to provide you with a service in your business or club – self-employed, casual worker, employee, limited company or volunteer with expenses – and how to pay them according to HMRC regulations.
Make sure you have proof of their status (particularly important for self-employment) and that you have processed all of the necessary paperwork required.
Declare Your Taxable Income
Ensure that all income you have received is declared to HMRC on your tax return and that any diary you keep matches the details in your income spreadsheet.
Make sure that any lessons you cancelled or that didn’t take place are clearly marked as such in your diary or at the club/centre where you work so that HMRC don’t suspect you of not declaring income. Always provide your diary to an inspector to back up the income declared in your bookkeeping records.
DON’T FORGET that an inspector is likely to have access to any booking sheets used by the centres you coach at so ensure that your records match their booking sheets – this catches out lots of coaches!
Get an Accountant
We recommend that you engage the services of a qualified accountant and name them as your agent with HMRC. You are less likely to be inspected if you are represented by a qualified accountant with a good reputation in your area.
We recommend that you pay the accountant to review your end of year accounts and to review what you are claiming for as expenses, whilst you do your own day to day bookkeeping.
NEED FURTHER ADVICE AND SUPPORT?
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