Annual Business Report

The article below relates to the 2019/20 Spreadsheet (referred to versions 3 or 4).
For the 2020/21 Spreadsheet, please refer to this section.

We’ve included a comprehensive reporting tool on our latest spreadsheet to provide you with even more information about your business, Tax, VAT and National Insurance responsibilities.

You can access the report through the ‘View Profit and Loss Account’ button on the Main Menu.

Monthly Analysis

The top section of the report provides a breakdown, on a month by month basis of your Income and Expenses, taken from the monthly pages, as well as your Mileage and Working from Home allowance sections of the report.

The chart on the right shows the breakdown of the total income and expenses for your business. The last box in the table shows the Profit or Loss which the business has – this is what your Tax and National Insurance will be based on

New reporting functions

Version 3 of our spreadsheet brings new and exciting (even for tax!) ways to understand your business. These sections are explained below.

The reporting tools listed below are part of the Beta version of our new spreadsheet. Although the calculations above for Income and Expenses on this spreadsheet are accurate, the tax calculations and national insurance below may not calculate correctly during this testing phase. You can safely use this spreadsheet for the purposes of completing your return (using the Income and Expense figures above, however everything below this message is currently in a test phase!

Some caveats to these reports/functions:

  • The system will assess you as not being employed or have any other income for the purposes of any tax or national insurance calculations. if you have any other income (benefits, pensions, employment, etc), these indicative calculations will not be accurate
  • If you’ve VAT registered, you cannot use the spreadsheet
  • Malgra doesn’t take responsibility for these calculations being accurate as individuals may have different tax arrangements or matters with HMRC that do not fit into the standard HMRC guidance
  • The system can only calculate based on what you’ve entered into the spreadsheet

VAT Threshold Check

If you earn over £85,000 in self employment (2019/20), you’ll need to be registered and pay VAT on a quarterly basis to HMRC. Our spreadsheets and accounting tools do not support VAT.

The VAT Threshold Check looks at your current income and calculates where you are in regards to the threshold. A handy chart to the side gives you a visual indication of where you are in relation to the VAT Threshold.

If you approach within £1,000 of the threshold, the system will warn you. If you go beyond the threshold, the messaging will change to advise you to contact our support team for the next steps which you’ll need to follow and how to register for VAT.

HMRC Tax Indications

The system will attempt to calculate your Tax based on your current profit, from the information provided in the spreadsheet.

Nearly all individuals will have a tax-free allowance provided, and the system will calculate based on the allowance as to what tax you’re likely to have at the end of the year.

There is a calculation error on versions 3.33 and below whereby the tax-free allowance is the incorrect value. This was corrected on version 3.34

The spreadsheet currently doesn’t calculate the higher tax rate.

National Insurance Calculations

The system can calculate Class 2 and Class 4 National Insurance against any profit which is taxable through the spreadsheet. This allows you to understand the likely amounts of Class 2 and Class 4 which are applied to any profits.

The below example shows a profit of £20,000. As such, both Class 2 and Class 4 are due, and the system has calculated the amount based on the profit above £8,632 at 9%.

The system does not calculate on profits of over 2% – if you need to be paying these, it’s likely you will need to be VAT registered.

Payments on Account

The system has been setup to calculate where Payments on Account are due depending on your circumstances.

Payments on Account are due when a tax bill is over £1,000. These are additional payments which you need to make, but are taken against any future tax bill. Class 4 NI contributions are also included in this amount.

The below example shows how the profit of £20,000 used in earlier examples has been processed through the system.

In this example, the system has calculated that £1,630 is due as tax, and £1,023.12 is for Class 4 National Insurance.

The system has calculated that Payments on Account are required, and these are listed on the table.

The table also shows the dates of when these total payments are due.

Note: These calculations do not include Class 2 at this stage

Updated on May 21, 2021

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