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Paperless business accounts

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brightncheerful
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Paperless business accounts

#50957

Postby brightncheerful » May 3rd, 2017, 3:29 pm

Until recently I have been using for some 30 years now a perfectly good desktop software for my business accounts. The snag is it's Windows only and is the only reason I still have a pc (Pentium 4 inside, Windows XP). I have trialled numerous accounting software for Mac but found none to my liking. In readiness for HMRC digital accounting, and with my accountants promoting Xero and I'm told some 40 of their clients using Xero, I have committed to X - which also has an advantage over other broswer-based accounting apps by being so I've read the only one that has been built for Mac architecture: others use plug-ins apparently. Anyhow, now that my accounting system is not tied to my pc, I am considering going one step further and scanning paper receipts to pdf. (For invoices, I have for a few years now only printed my copy to pdf and then print to paper only when the invoice is paid. The paper version is on plain paper, not headed notepaper.)

DAK please whether necessary to keep the original receipt, or can I shred it?

[When I 'enjoyed' a tax investigation a few years ago, HMRC wanted copies of various receipts but they didn't state that the receipts had to be the originals. Since I'd be scanning to pdf in colour I shouldn't have thought it matters? (I've also had 3 VAT and on each occasion various receipts had to be produced, but I had the originals then: I don't know if scanned versions would've been ok.)]

PinkDalek
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Re: Paperless business accounts

#50974

Postby PinkDalek » May 3rd, 2017, 4:53 pm

There's plenty out there on the subject.

Here's the latest I can find on electronic VAT invoices https://www.gov.uk/government/publicati ... -invoicing

I've yet to find the relevant place for Income Tax but know we found it way back at TMF. I have found this though from 1998 (my bold):

“Records may be preserved on optical imaging systems, and the originals discarded, provided that what is retained in digital form represents a complete and unaltered image of the underlying paper document.”

http://webarchive.nationalarchives.gov. ... s/tb37.pdf

When you say
For invoices, I have for a few years now only printed my copy to pdf and then print to paper only when the invoice is paid. The paper version is on plain paper, not headed notepaper.
I don't recall carbon copied versions of invoices having the headed notepaper type detail.

PinkDalek
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Re: Paperless business accounts

#51009

Postby PinkDalek » May 3rd, 2017, 6:54 pm

I thought we'd discussed this before. No idea if it helps your specific questions but see:

http://boards.fool.co.uk/tax-investigat ... sort=whole

The links therein are probably broken or less informative than they were, having been dumbed down, but I wrote this on your thread back in 2008:

BnC "the Revenue want to see the original receipts and will not accept copies, or in electronic form. ... So next time you're thinking, as I was only just the other day, why not pdf everything and chuck out the originals, think again!"

PD Are they following their own guidance?

See 'Keeping records: a quick guide' http://www.hmrc.gov.uk/startingup/keeprecs.htm


'Can I use my computer to keep records?

If you transfer details from paper records onto a computer, you will still normally have to keep the original paper records unless you microfilm them or use an optical imaging system. You don't have to print everything out, as long as the information in the original documents can be recovered from the computer and satisfies the other rules for record keeping.'



See 'Record keeping for tax purposes' http://www.direct.gov.uk/en/MoneyTaxAnd ... s/SelfAs...

Also see http://www.hmrc.gov.uk/pdfs/sabk4.htm

There have been recent posts on this area but I haven't found them on a quick search.


Keeping records: a quick guide is archived here:

http://webarchive.nationalarchives.gov. ... eprecs.htm

Having said all that, I've now found this (from 2013):

https://www.gov.uk/government/uploads/s ... rk-bk1.pdf

It includes (my bold!]:

If you keep your records
on computer

You can keep most records on a computer or use any storage
device such as CD-ROM, USB memory stick or a network drive.
You may not need to keep the original paper records as long as
the method you use captures all the information (front and back)
on the document and allows you to present the information
to us in a readable format, if requested.

M0n1ter
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Re: Paperless business accounts

#51219

Postby M0n1ter » May 4th, 2017, 1:40 pm

Having been dragged out of retirement to help develop a tax practice for an accountancy firm that uses Xero for all its clients (350 +), I've been amazed at what it can do. If you scan and upload the receipts / incoming invoices into Xero this is perfectly acceptable for HMRC. In fact for clients with more invoices and lots of cash receipts we use an add on called receiptbank and another called expensify where you take a photo on the app and it does it all for you - including posting once the rules have been set up

What with that and sales invoices being emailed automatically (you can save your own header/footer theme easily) and automatically posted into the software, thats easy too.

Also you can use bank feeds to download / update you business bank accounts daily.

As a former sage (etc etc ) user of over 20+ years, its the easiest to use accounting software i have seen.

If you dont like it there are some other alternatives out there more geared to contractors/ service businesses eg Free Agent, but if your accountancy firm is pushing Xero they have made a decent choice.

Slarti
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Re: Paperless business accounts

#51281

Postby Slarti » May 4th, 2017, 7:37 pm

My 2 penn'orth

As has been said, scan both sides of every document received, otherwise they moan,even if you know there is nothing on the reverse.

I haven't had headed paper for about 15 years, just setting up a Word template that I print as required and that I have duplicated in Access, so when I print an invoice, physical or to PDF, it looks as if on headed paper. I send 99% of my invoices electronically.

As for Xero, make sure that you have plain text file backups of your accounts, on your machine just in case they suddenly disappear.
I know somebody who was using an early cloud accounting system and doing their backup to his PC, but when they suddenly went pop, the backups were almost useless in recovering his data, being in a propitiatory format.

Also, with them being a New Zealand based company, do you have any clients who have problems with data relating to them being held offshore? I presume that is where their servers are?

I have one client who would be very unhappy if anything relating to them were offshore.


And, there are quite a few online accounting packages that are platform neutral and that do not require anything on your machines.

Slarti

brightncheerful
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Re: Paperless business accounts

#51373

Postby brightncheerful » May 5th, 2017, 10:27 am

All very interesting and helpful, thank you.

I am not going to upload invoices or receipts to Xero. Nor will I be using the bank feed feature. (Client confidentiality is protected.)

I envisaged scanning only the material info on receipts but will do everything regardless. No big deal, I have a high-speed duplex colour scanner.

Currently, I keep all paper receipts and invoices for each month, together with a print-out of the transactions for that month, in a plastic folder. 12 months of folders and other bits and bobs usually fills up a box file.

The only reason I need to change my system is that I shall be ditching the pc which means the software I'm using won't be available. By scanning the past,I should be quicker to deal with any matters arising. Also, it will free up much needed shelf-space. For example, recently a client having mislaid my invoices asked me to confirm the dates and amounts of some payments he'd made to me so he could complete his tax return due in that week: I obliged same day but it took me more than an hour to find everything. Whereas for my work, my systems are such that I can usually lay my hands on any information within minutes.

I shall continue keeping the printed originals but rather than store them in folders they can be kept loose in fewer box files and occupy less shelf-space. Now that I think about, I might use file dividers so that the receipts could kept in subject matters rather than date order alone. Finding an electricity bill, for example, from 2012. would be easier if all elec bills were together, than wading through 12 months of plastic folders.

brightncheerful
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Re: Paperless business accounts

#51381

Postby brightncheerful » May 5th, 2017, 10:58 am

M0n1ter wrote:Having been dragged out of retirement to help develop a tax practice for an accountancy firm that uses Xero for all its clients (350 +)


My accountants have circa 1400 clients and i'm told about 40 of them are using Xero. We talked about other browser-based accounting systems but from a combination of my trialling (include Sage which I found convoluted0 and their experience I concluded that Xero would be the better option.

I expected X to be a steep learning curve and haven't been disappointed! However, after a weekend of entering all figures for the whole of my current financial year (which ends this month) and ensuring that how I've gone about it tallies with my VAT returns, I have managed to adapt X to my requirements. I like to enter all likely expenditure for a year ahead and then adjust the amount for each transaction if as and when, or delete. That way I can keep an eye on my cash-flow requirements for the whole of my financial year, including for how long I can afford to be complacent! So far, I am delighted that I'm no longer tied to a pc and on a desktop, but can update my records whenever.


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