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20 December, 2019
Now that we are approaching the end of the 2019-20 tax year it’s worth noting that you are required to keep your self-employed business records – that underpin your self-assessment tax return for 2019-20 – for 5 years after the 31 January 2021 submission deadline.
This means that you will need to retain your 2019-20 business records until the end of January 2026.
If you lose your business records or if they are stolen or destroyed and you are unable to recreate the transactions, you must do your best to provide figures for your tax return. You will need to advise HMRC if you use estimated or provisional figures.
Your records will need to back-up your business sales, expenses and VAT/PAYE records if you are registered for VAT or employ people.
HMRC may ask to see your:
Also, if you have produced accounts using the traditional, accruals method, HMRC may ask to see further records that provide details of:
If you keep your records in a computerised format, make sure you backup each year’s transactions so you can provide details if required. More on how long to keep them.
You can give as many gifts of up to £250 per person as you want during the tax year as long as you have not used another exemption on the same person.
Even if your gift is not excluded by these exemptions any tax payable can be deferred under the “potentially exempt transfer” or PETs. Essentially, as long as the person making the gift lives seven years after making the gift, no IHT is payable. A sliding scale applies if the donor dies during this seven year period.
Blog post by: Nabeel Khalid