Benefits-in-kind, Bookkeeping and Budgeting
Benefits-in-kind
If you are an employee you can receive benefits that are paid for by your employer. Your employer can be a large company, like BT, your own limited company or a sole trader. Most benefits paid for by your employer are taxable, as if you had received the money and gone out and purchased the benefit for yourself. Some benefits are not taxable, for example, payments to pension schemes, the provision of a mobile (or smart) phone and the provision of childcare vouchers.
Bookkeeping
This is your day-to-day or month-to-month business record keeping. You can complete your records using manual books, on a spreadsheet or using an accounting system. The choice is yours and will depend on how big your business is and how familiar you are with accounting software or Excel spreadsheets.
You need to be methodical with your bookkeeping and if you have a business bank account, check the balance you have in your records agrees with the balance given on the bank statment. It will help you check that you have entered everything in your books.
Budgeting
There is of course the yearly budget presented by the Chancellor in March which forms the basis of the Finance Act. This determines the tax rates and allowances for the coming year.
You can, and if you need to meet cash flow payments such as a mortgage or bank loan payments, you should prepare a budget. This document will forecast your income, expenses and cashflows and will alert you to problems before they happen. The bank will not be impressed if you cannot meet a loan repayment and only tell then the day before the payment is due when you look in your bank account. The bank will listen more considerately if you have a business budget and you can explain what has gone wrong and how you are aiming to solve the problem.