Quite apart from the "timing" differences which make that statement nonsensical, it could simply be reimbursement of mileage, or change taken out of the till for the Petty Cash tin.
Actually, its a Round Sum Allowance and should be subject to PAYE and NIC
None of the above. Only the other day he had forgotten the company charge card when going to fill up the company car, so he'd paid for that out of his own pocket. Came to exactly £50, as it happens, so he was just reimbursing himself. The note was left as a reminder to himself to make the right entries in the analytical imprest petty cash book later. He was in a bit of a tizz, after all, having only just remembered the wife's birthday, and the cheap flowers were *not* going to be enough, so with the change from the tea, milk, and flowers, he got a £12 box of chocolates in the vain hope that darling would be assuaged, at least temporarily, and a £30 bottle of malt (for himself) in the likelier event that she would not.
Thank you Troy. I would have thought you had grown accustomed to, if not positively delighted at, us agreeing so much :-)
I like your contention that it's only fraud if you deliberately gain a tax advantage. Since when does the consequence determine whether or not a fraud has been committed?
When my employer reimburses my March expenses on 6th April, is it fraudulent if I net them off in the one tax return rather than enjoy a tax rebate for a year?
Do you consider it fraud whenever a solicitor or other professional asks a client to sign forms without dating them?
Rules are for the obedience of fools and the guidance of wise men. The wise men, in my book, are pragmatic and realistic. Fraud doesn't come into it - especially when all we're discussing is documenting the meeting the sole director & member had with himself in the bath last week!
What's nonsensical and why?
The whole point here, Troy, is that we are not talking about a dividend having been declared prior to 6 April and only the documentation having been put in place retrospectively. This is NOT a case of someone forgetting to put in place the documentation or waiting for his accountant to prepare the documents. This IS a case of the dividend cannot have been declared before 11 April because the OP's original question shows that he had not declared the dividend because he was only asking for advice on 11 April. It is the date of declaration that is important and the OP's posting is evidence that he had not declared the dividend by 6 April. Any documentation that is now produced showing otherwise would be considered to be fraudulent by HMRC if that documentation pretended the dividend had been declared prior to 11 April and it was used to obtain or to try to obtain a tax advantage by pretending that a dvidend was declared prior to 6 April.
The first one's nonsensical because my firm doesn't maintain double entry records; simply an old fashioned hand written cash book. So whether anything has been "posted to a net wages account" will be a retrospective judgement taken by his accountant six months after the company's year and, and with all transactions bearing that as a date.
It is not my contention, Martin, that it is ONLY fraud if you deliberately gain a tax advantage. You are being rather simplistic in reading that into my words. However if you commit fraud and you gain a tax advantage by doing so then HMRC would view it very seriously. If you commit fraud and there is no tax advantage then HMRC are likely to be less interested, of course, but there are likely to be other parties who would be interested
The instances you quote are not the same as deliberately creating a document which pretends that something has happened when it has not, and by that pretence there is a tax advantage. The evidence (in the form of the original poster's words on this group) shows that the OP cannot have declared the dividend prior to 11 April. To produce documentation, minutes etc which pretend that there was a meeting last week (in the bath or wherever) when on 11 April the poster asked for advice and his posting showed that he had not at that date declared a dividend would be potentially fraudulent if that documentation was produced to HMRC in order to gain a tax advantage.
The OP would be well advised to consult an accountant well experienced in these matters, and not rely upon someone who advocates the production of fruadulent documentation which may lead him into all kinds of problems should HMRC enquire into the circumstances. If the solution relies upon HMRC not being told the truth or upon HMRC not enquiring too deeply into the circumstances then he should beware! Smoke and mirrors may not work!
This is a fantastic bit of back-pedalling, and certainly if you are going to commit a misdemeanour it is best not to broadcast the fact to Usenet. But...
1) OP takes professional advice. 2) Martin writes up "bathroom" notes or (more likely IME) nothing is written at all until required by HMRC. 3) OP signs where he is told and the deed is done!
Who is back-pedalling, Troy? Not me!
The OP was not looking to commit a misdemeanour but some of the postings here were leading him that way. I was just trying to steer him in the way of taking GOOD advice (which he will have to pay for) and steering him away from fraudulent actions which he was being blindly lead into.
"Troy Steadman" wrote
Never mind the accounts (which don't need to be prepared until a while afterwards) -- what about a Payslip, has one been prepared and given
**on or before** the day payment was made, as required by law? If not, then how can it be salary/wages?"Troy Steadman" wrote
By "deed is done", you mean the fraud? :-((
Peter is not questioning the payslip and nor am I.
It is what happens to the Net payment. Is it paid into a Director's Loan Account where it can be drawn down? Is it retained in a (notionally separate) Net Wages Control A/C? And in that latter case, if it is in the till, can the Director help himself to it and toddle down to Sainsbury's?
I don't think the professional sees it that way. He sees it as "correcting an error", "putting things right". All kinds of things go wrong in the average business, and this is just another mistake to be recified.
In much the same way that when you find yourself doing 35 in a 30mph zone, you don't hand yourself in at the nearest police station.
"Troy Steadman" wrot
Maybe not, but I am - so what is it, has a payslip been properly produced?
"Troy Steadman" wrote
Reality doesn't need to reflect the accounts, but rather the accounts need to reflect reality. So your questions are nonsensical....
In the circumstances we have outlined HMRC would see it as fraud. The only question is; will they find out about it? In some cases they do!
"Troy Steadman" wrote
You are suggesting that breaking the law is OK if it helps you do want you want???!!!!!! :-((
"Troy Steadman" wrote
If I didn't, that wouldn't mean that I hadn't broken the law. I would have done.
Well said Tim.
I am appalled at some the the questionable, and dangerous, advice given in this group, I must admit.
"Troy Steadman" wrote
Just because they might get away with committing fraud, doesn't mean that it hasn't been committed!
Huh? A Director's wages are usually run through the PAYE system, along with everyone else's. The Net amount is often posted to a Net Wages Control A/C:
DR: Salaries CR PAYE/NI EES CR: Net Wages Control
Maybe he is paid by:
1) A Cheque or BACS.DR: Net Wages Control CR: Bank
2) A Credit to his Current Account ("Director's Loan Account") with the Company.DR: Net Wages Control CR: Director's Loan Account
3) Cash.Peter is saying: "You can only do (3) if you have the amount sitting in a Net Wages Control".
I'm saying is that my company has a till but doesn't maintain a Balance Sheet. So it is a meaningless test.
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