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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4882
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Hi there, Im filling out the CT600 PDF for both HMRC and CH

Resolved Question:

Hi there, I'm filling out the CT600 PDF for both HMRC and CH and have the same issues I've read about across your forums for the last few days. I still can't get mine to balance and would appreciate some guidance.

This is my first years account which is actually a 6 months accounting period from 9th July 2012 - 31st Dec 2012. I initially had issues with boxes AC74 and AC80 and whilst adjusting those is also threw out the figures further down the line on boxes AC187.

My business transaction are quite simple and I just want to make sure that the capital injection I put into the company comes out again somewhere down the line and after speaking to a Tax advisor at HMRC a couple of days ago, he advised me to split my purchases across Cost of Sale and Intangible and Tangible Assets and I think this is where I'm having issues.

Please advise how we should proceed? thank you.

Regards
Phill
Submitted: 3 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 3 years ago.
Hello and welcome to the site. Thank you for your question.

Please complete boxes as applicable and I will review the accounts for you.

Description Box This year
of account No. Amount
PROFIT AND LOSS
TURNOVER AC12 0
COST OF SALES AC14 0
GROSS PROFIT AC16 0
DISTRIBUTION COSTS AC18 0
ADMINISTRATIVE EXPENSES AC20 0
OTHER OPERATION INCOME AC22 0
OPERATING PROFIT OR (LOSS) AC26 0
INTEREST RECEIVABLE AC28 0
INTEREST PAYABLE AC30 0
PROFIT OR (LOSS) BEFORE TAX AC32 0
TAX AC34 0
PROFIT OR (LOSS) FOR THE YEAR AC36 0
DIVIDENDS FOR THE PERIOD AC38 0
TRANSFERRED TO RESERVES AC40 0
Description Box This year
of account No. Amount
BALANCE SHEET
INTANGIBLE ASSETS AC42 0
TANGIBLE ASSETS AC44 0
TOTAL FIXED ASSETS AC48 0
STOCKS AC50 0
DEBTORS AC52 0
CASH AT BANK AND IN HAND AC54 0
TOTAL CURRENT ASSETS AC56 0
CREDITORS DUE WITHIN ONE YEAR AC58 0
NET CURRENT ASSETS AC60 0
TOTAL ASSETS LESS CURRENT LIABILITIES AC62 0
CREDITORS DUE AFTER MORE THAN ONE YEAR AC64 0
PROVISION FOR LIABILITIES AC66 0
TOTAL NET ASSETS AC68 0
Description Box This year
of account No. Amount
CAPITAL AND RESERVES
CALLED UP SHARE CAPITAL AC70 0
REVALUATION RESERVE AC76 0
PROFIT AND LOSS ACCCOUNT AC74 0
TOTAL SHAREHOLDERS FUNDS AC80 0
Difference xxxx 0
Description Box This year
of account No. Amount
STATUTORY ACCOUNTS NOTES
profit and loss - opening balance AC184 0
profit for the period AC185 0
equity dividends paid AC186 0
retained profit AC187 0

Many thanks
Expert:  taxadvisor.uk replied 3 years ago.

Phill, in your introduction you stated

"My business transaction are quite simple and I just want to make sure that the capital injection I put into the company comes out again somewhere down the line and after speaking to a Tax advisor at HMRC a couple of days ago, he advised me to split my purchases across Cost of Sale and Intangible and Tangible Assets and I think this is where I'm having issues".

Please advise what your capital injection was and how much of that remained unpaid to you at the year end.

Was it used to fund purchases and/or fixed assets and how has it been accounted for?

Many thanks

Customer: replied 3 years ago.

Hi there, just to paint a clearer picture of our business, we incorporate in July 2012 and began learning our business with software and courses purchased. We launched our first product in December 2012 and thus our first income didn't appear until Dec 2012.
My initial concern is that our total expenditure (capital injection) was £8739.00 and I wanted to make sure this was being token down and entered into the correct boxes, spread across:
I'm not sure if this is correct or indeed the best practice?
Cost of Sales AC14

Item
Cost - GBP
Companies House Registration
£18.00
Apple Developer Registration
£60.00
Elance Job listing
£3.10
Graphic PSD Template
£2.50
App Coder
£140.55



£224.15

£224.00




Intangible Assets AC42

Item
Cost - GBP
App Training Course
£1,375.77
App Course & Coding Software
£6,384.60



£7,760.37

£7,760.00




Tangible Assets AC44

Item
Cost - GBP
5 year domain name renewal
£34.49
Macbook Pro laptop
£700.00
Mac OSX Snow Leopard 10.6.3 Family Pack
£21.00



£755.49

£755.00


TOTAL
£8,739.00

Here are the figures you requested:


Description
Box
This year
of account
No.
Amount
PROFIT AND LOSS
TURNOVER
AC12
509
COST OF SALES
AC14
224
GROSS PROFIT
AC16
285
DISTRIBUTION COSTS
AC18
0
ADMINISTRATIVE EXPENSES
AC20
324
OTHER OPERATION INCOME
AC22
0
OPERATING PROFIT OR (LOSS)
AC26
-39
INTEREST RECEIVABLE
AC28
0
INTEREST PAYABLE
AC30
0
PROFIT OR (LOSS) BEFORE TAX
AC32
-39
TAX
AC34
0
PROFIT OR (LOSS) FOR THE YEAR
AC36
-39
DIVIDENDS FOR THE PERIOD
AC38
0
TRANSFERRED TO RESERVES
AC40
-39
Description
Box
This year
of account
No.
Amount
BALANCE SHEET
INTANGIBLE ASSETS
AC42
7760
TANGIBLE ASSETS
AC44
755
TOTAL FIXED ASSETS
AC48
8515
STOCKS
AC50
0
DEBTORS
AC52
0
CASH AT BANK AND IN HAND
AC54
0
TOTAL CURRENT ASSETS
AC56
0
CREDITORS DUE WITHIN ONE YEAR
AC58
0
NET CURRENT ASSETS
AC60
0
TOTAL ASSETS LESS CURRENT LIABILITIES
AC62
8515
CREDITORS DUE AFTER MORE THAN ONE YEAR
AC64
8739
PROVISION FOR LIABILITIES
AC66
0
TOTAL NET ASSETS
AC68
-224
Description
Box
This year
of account
No.
Amount
CAPITAL AND RESERVES
CALLED UP SHARE CAPITAL
AC70
0
REVALUATION RESERVE
AC76
0
PROFIT AND LOSS ACCOUNT
AC74
0
TOTAL SHAREHOLDERS FUNDS
AC80
-224
Difference
xxxx
0
Description
Box
This year
of account
No.
Amount
STATUTORY ACCOUNTS NOTES
profit and loss - opening balance
AC184
0
profit for the period
AC185
-39
equity dividends paid
AC186
0
retained profit
AC187
-39

AC187 Currently showing the ERROR)

Expert:  taxadvisor.uk replied 3 years ago.
Phill, thank you for your reply and additional information.

I will review your accounts and revert to you shortly.

Many thanks
Expert:  taxadvisor.uk replied 3 years ago.
Phill, this is what I would do....

Move the expense shown in Box AC14 to Box AC20 as I would regard all this expenditure as admin costs.

Furthermore, I would be inclined to expense the cost of training courses and coding software within admin costs in the year of spend unless there was no activity at all. Move from Intangible Assets AC42 £7,760 to AC20

There was some cash flow from income and expenses has appear to have missed double entry and I have reduced your creditors in Box AC64 by £185 to reflect this (Sales revenue £509 and admin costs £324).

Here is my version of your accounts for your consideration.. They balance and there is no error message.
Description Box This year
of account No. Amount
PROFIT AND LOSS
TURNOVER AC12 509
COST OF SALES AC14 0
GROSS PROFIT AC16 509
DISTRIBUTION COSTS AC18 0
ADMINISTRATIVE EXPENSES AC20 8,308
OTHER OPERATION INCOME AC22 0
OPERATING PROFIT OR (LOSS) AC26 -7,799
INTEREST RECEIVABLE AC28 0
INTEREST PAYABLE AC30 0
PROFIT OR (LOSS) BEFORE TAX AC32 -7,799
TAX AC34 0
PROFIT OR (LOSS) FOR THE YEAR AC36 -7,799
DIVIDENDS FOR THE PERIOD AC38 0
TRANSFERRED TO RESERVES AC40 -7,799
Description Box This year
of account No. Amount
BALANCE SHEET
INTANGIBLE ASSETS AC42 0
TANGIBLE ASSETS AC44 755
TOTAL FIXED ASSETS AC48 755
STOCKS AC50 0
DEBTORS AC52 0
CASH AT BANK AND IN HAND AC54 0
TOTAL CURRENT ASSETS AC56 0
CREDITORS DUE WITHIN ONE YEAR AC58 0
NET CURRENT ASSETS AC60 0
TOTAL ASSETS LESS CURRENT LIABILITIES AC62 755
CREDITORS DUE AFTER MORE THAN ONE YEAR AC64 8,554
PROVISION FOR LIABILITIES AC66 0
TOTAL NET ASSETS AC68 -7,799
Description Box This year
of account No. Amount
CAPITAL AND RESERVES
CALLED UP SHARE CAPITAL AC70 0
REVALUATION RESERVE AC76 0
PROFIT AND LOSS ACCCOUNT AC74 -7,799
TOTAL SHAREHOLDERS FUNDS AC80 -7,799
Difference xxxx 0
Description Box This year
of account No. Amount
STATUTORY ACCOUNTS NOTES
profit and loss - opening balance AC184 0
profit for the period AC185 -7,799
equity dividends paid AC186 0
retained profit AC187 -7,799


I hope this is helpful and answers your question.


If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.



Expert:  taxadvisor.uk replied 3 years ago.

Phill, I have just noticed you have within tangible assets domain renewal charge £34 and family pack of some software £21. I would expense these items to admin costs being small value expenditure and just leave the cost of Macpro laptop in tangible assets.

I hope this is helpful.

Customer: replied 3 years ago.

Thank you, XXXXX XXXXX entered all the figures and submitted to Companies House, so they've gone now. Would you suggest I make the changes you mentioned from tangible assets to admin expenses, or leave the figures as they were now I'm filling out the Computation part of the CT600?

Expert:  taxadvisor.uk replied 3 years ago.
Phill, if you have already submitted the accounts to Companies House, I would leave the figures as they are for consistency.

I hope this is helpful and answers your question.


If you are happy and there are no more issues I will appreciate if you would kindly rate the service I provided to ensure I get credited for it.

Customer: replied 3 years ago.

Hi there, many thanks for your detailed response, very much appreciated and all goo, thank you.



Before we sign off, can you please explain your computations on what you said here:


 


There was some cash flow from income and expenses has appear to have missed double entry and I have reduced your creditors in Box AC64 by £185 to reflect this (Sales revenue £509 and admin costs £324).




I want to make sure my book tally with your suggestions and this part was a little unclear, thanks.



Expert:  taxadvisor.uk replied 3 years ago.
Phill, thank you for your reply.
I am pleased you have managed to complete your CT600 return.

In your original presentation to me you had shown in
CREDITORS DUE AFTER MORE THAN ONE YEAR AC64 an amount of £8739.
This covered initial investment in courses,tangible fixed assets etc.

At the year end you did no show any debtors or cash and bank balance yet there was some income and admin costs. In order to balance the books I have taken these amounts as monies received by you and paid out of own funds and the difference is what you had retained and therefore reduced creditors to reflect it.

I hope this helps
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4882
Experience: FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
taxadvisor.uk and 3 other Tax Specialists are ready to help you
Expert:  taxadvisor.uk replied 3 years ago.
I thank you for accepting my answer.

Best wishes.

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