As the year draws to an end and everybody starts winding down for the holidays, now’s the time to make sure you’ve got all your tax information ready moving into 2022. 

There are many different records you need to prepare, so it can be a little daunting for business owners. That’s why an end of year tax checklist can make your life a whole lot easier. 

In this handy checklist, we’ll cover:

  • End of year deadlines.
  • Business records for sole traders. 
  • Business records for limited companies.
  • VAT deadlines.
  • How to make your financial management easier. 

End of year deadlines

The end of the calendar year doesn’t necessarily coincide with the end of the financial year. Your actual end-of-year deadlines for tax returns will depend on whether you’re a limited company or sole trader and when you first registered with HMRC. 

Sole traders

If you’re a sole trader, then you’re deadlines for submitting a self-assessment tax return from 2020 to 2021 are:

  • 31 October 2021 for paper returns.  
  • 31 January 2022 for online tax returns.

Limited companies

Limited companies work a little differently. First of all, you need to submit more detailed company records compared to sole traders. Also, the deadlines for submitting them depends on the date you first registered with HMRC and companies house

As a limited company, the main deadlines you’ll need to know about are:

  • First accounts with Companies House: 21 months after the date you registered with Companies House.
  • Annual accounts with Companies House: 9 months after your company’s financial year ends.
  • Corporation Tax: 9 months and 1 day after your ‘accounting period’ for Corporation Tax ends.
  • Company Tax Return: 12 months after your accounting period for Corporation Tax ends.

When you register your limited company with HMRC, you’ll get a letter with the dates of your accounting period. 

VAT deadlines

If your business has an annual turnover of £85,000 or more, then you’ll need to register for value-added tax (VAT). You usually submit a VAT return every three months.

The VAT Return records things for the accounting period like:

  • Your total sales and purchases.
  • The amount of VAT you owe.
  • The amount of VAT you can reclaim.
  • What your VAT refund from HMRC is.

Business records for sole traders

As a sole trader, you need to prepare financial records for your own self-assessment tax return. For your tax return, you’ll need to keep records of:

  • All sales and income.
  • Business expenses.
  • VAT records if you’re registered for VAT.
  • PAYE records if you employ people.
  • Records about your personal income.
  • Grants, if you claimed through the Self-Employment Income Support Scheme.
  • What you’re owed but have not received yet.
  • What you’ve committed to spend but haven’t paid out yet.
  • The value of stock and work in progress at the end of your accounting period.
  • Your year-end bank balances.
  • How much you’ve invested in the business in the year.
  • How much money you’ve taken out for personal use.

Business records for limited companies

Just like sole traders, limited companies must record detailed financial records, such as:

  • All money your company receives and spends.
  • Details of assets your company owns.
  • Debts the business owes or is owed.
  • All goods bought and sold.
  • Who you bought goods or services from.
  • Who you sold goods and services to.
  • Stock the company owns at the end of the financial year.

Unlike sole traders, limited companies must also submit records about the company itself, including information like:

  • Directors, shareholders, and company managers.
  • Results of any shareholder votes and decisions.
  • Promises to repay loans at a specific future date and to whom they should be paid. 
  • Promises your company makes for payments if something goes wrong and it’s the company’s fault. 
  • Transactions when someone buys shares in the company.
  • Loans or mortgages you take out against the company’s assets.

Because limited companies are owned by shareholders, you also need to keep a register of people with significant control (PSC). A PSC register should include details of anybody who:

  • Has more than 25% shares or voting rights in your company.
  • Can appoint or remove a majority of directors.
  • Can influence or control your company or trust.

Prepare for tax season with the right accounting software for your business

The most difficult thing about doing your taxes is having to record all your income and expenses throughout the year. 

Even after that, you need to calculate how much you’ll be paying in taxes to get a true picture of your financial situation. That’s why thousands of business owners use the Countingup app to make their financial admin easier. 

Countingup is the business current account with built-in accounting software that allows you to manage all your financial data in one place. With features like automatic expense categorisation, invoicing on the go, receipt capture tools, tax estimates, and cash flow insights, you can confidently keep on top of your business finances wherever you are. 

You can also share your bookkeeping with your accountant instantly without worrying about duplication errors, data lags or inaccuracies. Seamless, simple, and straightforward.

Find out more here and start your three-month free trial today.