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Current year The basic rule is that an individual’s taxable profit assessed in each tax year will bebased on the profits for the 12 months accounting period ending in that tax year. Thisis known as the current year basis. This applies to individuals who havebeen in trade for several years past. An individual in business … Read More
Welcome to first in a series of blog posts about basis periods, found in the AAT Level 4 Business Tax module. 1 – Introduction The basis period is the accounting period within which an individual’s income or profitswill be subjected to tax. Every individual tax payer pays their taxes based on a tax year. The … Read More
Accounting Equation: ASSETS – LIABILITIES = CAPITAL QUESTION: Anushka began a sole trade business on 1 January 20X1. During the first month of trading, the following transactions took place: She started the business with £5,000 of cashShe took out a loan from the bank of £10,000She purchased a van for £12,000 cashShe purchased 100 units … Read More
FRS 18 sets out two main qualitative characteristics (relevance & reliability) and fourenhancing qualitative characteristics that information in the financial statements shouldpossess in order for the content of the financial statements to be useful to its users.When an accounting policy is to be selected, its appropriateness to the businessshould also be considered against these qualities. … Read More
Check out our latest collection of YouTube videos on Tax Processes for Business! AAT Level 3 | The Training Place
TAXABLE SUPPLIES HMRC indicate that the VAT Act 1994 section 4(2) provides that a taxable supply is a supply of goods or services made in the United Kingdom other than an exempt supply. This means that taxable supplies are all goods or services sold which are not within the exempt items or items outside the … Read More
An individual not in business but sold one of their personal art painting for £89,000, is a taxable person? TRUE / FALSE? FALSE So, who is a taxable person? A person or entity that carries out any economic activity and deals in taxable supplies, will be called a ‘taxable person’; whether it has registered for … Read More
DISCHARGE OF CONTRACTS Discharge of contracts implies a termination of the contractual agreement and the contract obligations come to an end. Discharge by performance Discharge by breach Discharge by performance is where all parties to a contract have fulfilled their part of the terms to the contract agreement, so all primary obligations will cease. Discharge … Read More
REMEDIES FOR BREACH OF CONTRACT Remedies for breach of contract include: · Action for price · Action for damages Action for price: Where there has been a breach of a contract of sale, the seller can sue the buyer for the price of the goods. Action for damages: Where there has been a breach of … Read More
WHAT ARE PRE-INCORPORATION CONTRACTS? These are contracts entered into by a third party on behalf of a company which has not yet been formed. A pre-incorporation contract is binding on the third party who is acting on behalf of the unformed company. · A pre-incorporation contract is a contract entered into on behalf of a company … Read More