The Chancellor has announced that cash basis accounting will replace accruals as the standard accounting process for self employed individuals following the consultation earlier this year.
The move will also assist with preparation for Making Tax Digital (MTD) which will then show the taxation due following each quarter, based on the exact figures used for the relevant period.
For our members, the majority of MalgraBooks services already use the cash basis system, where transactions are logged when the money is actually received (instead of earned and incurred as is with accruals). This means that taxation is accurately showing all transactions which take place during the relevant financial year. Where members are on different schemes, our team will be in touch.
