Corp Tax summary - negative CT calc,retained profit/loss b/f & c/f suggestions

Feature Request Implemented
1

Hi Glenn

I have been looking at the Corporate tax summary, and i feel and if easy to implement, then I would like to suggest the following suggestion to the format/reporting structure of the CT tax summary. (this also considers the distributable profit feature from the other feature suggestion).

The ones in bold are additional suggested feature.

Lets say in PERIOD 1, the CT summary looks like this:

Retained Profit Brought Forward: £0.00

NET Profit from P&L £17,000 CR

Add backs £1,000.00 CR

Deductions £0 DR

Adjusted Taxable Profit £18,000.00 CR

Est. Corporation Tax (20%) £3,600.00 CR

Retained Profit before Distribution £14,400.00 CR

Dividends paid £10,000.00 DR

Retained/Distributable profit £4,400.00 CR

PERIOD 2:

Retained Profit Brought Forward: £4,400 CR

NET Profit from P&L £25,000 CR

Add backs £1,000.00 CR

Deductions £0 DR

Adjusted Taxable Profit £26,000.00 CR

Est. Corporation Tax (20%) £5,200.00 CR

Retained Profit before distribution: £25,200.00 CR

Dividends paid £25,000.00 DR

Retained/Distributable profit £200.00 CR

PERIOD 3:

Retained Profit Brought Forward £200.00 CR

NET Profit (LOSS) from P&L £15,000 DR

Add backs £1,000.00 CR

Deductions £0 DR

Adjusted Taxable Profit (LOSS) £13,800.00 DR

Est. Corporation Tax (20%) £0.00

Retained Profit (LOSS) before distribution: £13,800.00 DR

Dividends paid £0.00 DR

Retained/Distributable profit (LOSS) £13,800.00 DR

You will see that the retained/Distributable profit is carried forward to the next period.

There is mention of LOSS in the description if its a DR balance.

and if the P&L is showing loss (DR balance) then it does not calculate the 20% Corp tax.

What do you think of these suggestions? as always i feel these will make the reporting much more useful for the users.
Everyone else, please feel free to jump in and comment.

Many thanks

1 Like
2

I’ll leave it open for others to comment.

In all honesty I don’t think we’ll want to complicate the calculations too much. It is after all a summary and most QF users aren’t accountants so will likely struggle to fully decipher how the calculations are being applied.

3

hi Glenn

I agree re: making it more complicated, and that is why the format suggestion above is the bare minimum a CT/Dividend summary should have. Proper calculations can be a lot more complex, this to me (some of it maybe because i am an accountant) is very basic, minimum, right to the point report.

I hope accountants and both non-accountants using QF will see the need for such report.

Other thing to bear in mind and i have noticed, is many users didn’t show interest in the current existing CT tax report (before it was implemented), but once they see it, they find it handy. So until its out there i don’t think many will realise the usefulness of this report. (this is purely my observation)

Best regards

4

Hi Glenn,
Not sure how much work this would involve but Sameera’s suggestion is really useful. When I first saw the CT summary I also thought about brought forward losses and displaying distributable profits.
This would definitely give key info for both accountants and non-accountants.
Thanks
Jeremy

2 Likes
5

OK noted! I think we’ll explore this further.

We’re planning to add some additional lines to cover dividends and profits available for distribution. Hopefully we can look at the losses brought forward as part of this work.

2 Likes
6

Glenn, i think this post should be linked to the ‘planned feature’ - profit available for distribution on tax summary.
as it would impossible to implement one without the other!

7

We have now extended the tax summary for Limited Companies to show the following additional items:

  • Profit/Loss brought forward
  • Dividends brought forward
  • Dividends within the current period
  • Total Distributable Profit

You can reveal this information by clicking on the yellow bar:

924×135 7.36 KB

908×231 17.7 KB

This additional reporting information will be available on all accounts up until the 5th January after which you will need a power-user subscription to continue to view.

1 Like
8

Glenn, thank you for this.

I can appreciate that you are trying to keep this additional bit separate to the original summary on top of it.
But i don’t think the figures add up if you try to do that. or maybe you will need to change the presentation…

The P&L brought forward should be deducting current year’s profits to get the right corporate tax figure.
At the moment the corporate tax figure is still taking the current year profits as they are and estimating 20%.
This would also mean that the profit after tax is wrong.

Accounts with no negative P&L brought forward might not see the difference.
But as soon as you have a loss in the previous year, this layout won’t work.

Also on a separate note:

I also feel that this enhancement should be part of basic reporting for regular users rather than only for super users…
Yes, i agree that if people who want a more elaborate quick file layout like changing colours, special invoice templates…then yes, certainly this should be categorised as super user status.

It will be good to find out if there are other users who feel the way i do on this?

Thanks

9

Glenn

I agree with Sameera. Is any further development planned on that?

Thank you

1 Like
10

Which point is that? The first regarding the P&L B/F or that this report should be free?