Commentary

V7.210A Cash accounting scheme—planning points to consider

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.210A Cash accounting scheme—planning points to consider

Part V7 Tax planning | Commentary

V7.210A Cash accounting scheme—planning points to consider

The following points should be given consideration.

  1.  

    •     Review client lists to identify those that could benefit from adopting the cash accounting scheme, ie those within the annual turnover limit of £1,350,000 per year (taxable sales excluding VAT) and whose trading circumstances could produce worthwhile benefits.

  2.  

    •     The cash flow benefits and automatic bad debt relief given by the scheme could be particularly useful for many businesses.

  3.  

    •     The cash accounting scheme is probably not suitable for taxpayers supplying mainly zero-rated items, or for a business where customers pay in advance or as

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