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Sole Trader accounts - How to Post Employed Income.

  • Member
  • Practice Licence
  • 13 posts
  • # 115261

Hi,

How do I post employed income in my own sole trader bookkeeping practice Sage accounts?

I am using 4000 for my sole trader income.

Is it simply 1200 DR Bank and 4900 CR Miscellaneous Income? This then only shows my net employed income in 4900, and where do I show the gross employed income and related tax already deducted?

Thanks for any help in advance.

 

  • Fellow PM.Dip
  • 788 posts
  • # 115262

Hi,

Why would you wish to put employed income into self-employed accounts?

Employed income and tax deducted would be entered into Tax Return on separate page.

Your self-employed income and expenditure would be taken from your year-end P & L for business accounts and entered onto separate page in Tax Return.

  • Member
  • Practice Licence
  • 13 posts
  • # 115263

Thanks for quick reply.  Employed income appears on my bank statement.  Where should I post this income to - Capital introduced?

  • Fellow PM.Dip
  • Practice Licence
  • 140 posts
  • # 115264

>
> If the only reason that you want to keep track of employed income is to
> keep Sage inline with your bank account, then yes Capital Introduced would
> be where you would put it.
>

Torben

>
>

  • Associate PM.Dip
  • Practice Licence
  • 83 posts
  • # 115265

I would have thought it would be better to keep your self employed income and 'earned 'income in seperate accounts. That way your business account contains only self employed income and expenditure and your 'employed income' goes straight onto your SA tax return from your P60 - simples.

 

regards

  • Member
  • Practice Licence
  • 13 posts
  • # 115266

Hi,

Many thanks for your help. 

  • Fellow PM.Dip
  • 788 posts
  • # 115269

Hi,

So if your employed income is on your bank statement are you saying you don't have a separate business bank account?

You really should keep employed and self-employed separately for a few reasons -

namely - HMRC can look into your personal bank affairs if they think there is something untoward going on - why give them the opportunity? Plus the bank will not be happy if they find out you are running a business through your personal account.

secondly - if you wanted to go for a mortgage/loan the bank/lender may request a copy of your business accounts so your employed income should not be included.

Just think about it - if one of your clients was doing this wouldn't you be saying they should keep it separate? If only to make your life easier in producing their annual accounts?

  • Member
  • Practice Licence
  • 13 posts
  • # 115270

Hi,

Thanks for the advice.  I agree completely that personal and business accounts should be separated. As I only had 2 clients in the last start-up year and my employed hours picked up, I didn´t get round to opening a business bank account, but I will certainly sort that out now.

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