This month we are focusing on Bookkeeping and this week we look at – Why do bookkeeping – is it a legal requirement?
Running a growing business can involve a lot of hard work. Not least of which is the maintenance of the company accounts. Not everyone is great with figures, similarly not everyone realises their legal obligations.
Sole traders don’t have to legally but for limited companies it is a legal requirement in fact Section 386 of the Companies Act 2006 lays down the duty of every company to keep proper accounts,
“(1) Every company must keep adequate accounting records… …(3) Accounting records must, in particular, contain—
(a) entries from day to day of all sums of money received and expended by the company and the matters in respect of which the receipt and expenditure takes place,
and (b) a record of the assets and liabilities of the company. “
Section 387 makes it clear that failure to comply with this regulation is a criminal offence which is punishable with imprisonment.
And HMRC can fine you up to £3000
Remember the new Making Tax Digital requirements that will be in force ensuring you submit figures on a quarterly basis
If you know of a local business that needs help with their bookkeeping, please do pass on our details
Disclaimer:- The information contained herein is given by way of general guidance only and no action should be taken solely on the basis of the information contained herein. The Avanti Group (UK) Ltd will be pleased to provide further guidance on the issues, and how they might affect you. No liability is accepted by the firm for any action taken without seeking appropriate professional advice
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