Can Free Agent users see your current CT liability

[doconline]

Hi,

I just wondered if it was possible to see your current Corporation Tax liability for the financial year. I use Quick Books and it's not great to be honest. It's my accountant preferred application and included with their package.

I had a look at this page https://www.freeagent.com/tour/corporation-tax/ and it looks like an estimate is included, I presume this is fairly close, based on your current years full income / outgoings.

I'm about halfway through my financial year and want to know my current CT liability so I can take a dividend at the start of the Tax Year, and due to the time of year my accountant is a little slow getting back to me. Obviously not a priority for him and something I will be pointing out when I change accountants after this financial year.

Cheers

[TonyF]

Yes. I don't know how accurate it is - this is my first year using it.

But it tells me the income (by each source), then the expenses by cost centre to give an operating profit. Then it works out the 19% corporation tax and puts that into another cost centre (502 Corporation Tax Expense) and tells me what the profit is after tax and the reserves after tax.

I presume it's accurate as I guess this is what the accountant will use to work out the return at the end of the year.

T

[Fred Bloggs]

Yes.

[Maslins]

Two reasons why it can be way out:
1) the data you've entered in is rubbish,
2) you do something complex like R&D.
For a typical straight forward contractor where you take reasonable care of your books, the running estimate it gives throughout the year is very good.

[doconline]

Two reasons why it can be way out:
1) the data you've entered in is rubbish,
2) you do something complex like R&D.
For a typical straight forward contractor where you take reasonable care of your books, the running estimate it gives throughout the year is very good.

Thanks for the replies. Looks good. I'm just a standard contractor everything is run through my bank account, so would just be importing the figures, so looking for plug and play, which this sounds like.

[TonyF]

Thanks for the replies. Looks good. I'm just a standard contractor everything is run through my bank account, so would just be importing the figures, so looking for plug and play, which this sounds like.

You could register for the free trial and enter your data in there near year end and see what it comes out as.

If you then move to a freeagent accountant they can pick up that free account so you haven't lost anything and you have the previous year there in advance.

[TheCyclingProgrammer]

Two reasons why it can be way out:
1) the data you've entered in is rubbish,
2) you do something complex like R&D.
For a typical straight forward contractor where you take reasonable care of your books, the running estimate it gives throughout the year is very good.

A couple of other reasons (that affect me anyway):

* Your accountants account for deferred tax due to timing differences. I understand not all accountants bother with this for small businesses. My accountant has attempted to explain it to me twice. I have no idea!

* You had an opening asset pool on which you’ve reclaimed write down allowances until the pool dropped below £1k at which point the balance was written off using the small pools allowance. FreeAgent doesn’t support SPA so the asset pool will stay on your books forever.

* There might be slight rounding differences.

In my experience despite the above issues the calculation is accurate to within a few £100 or so. Each year you can journal the differences to the CT account using your accountants calculations.

[pr1]

I've been through two full company years using FreeAgent and the running corporation tax calculation has been within £50 or so of the accountants final calcs both times - it is generally really good (though relies on you categorising your bank statements etc properly, obviously - crap in crap out!)