Our club’s members have voted to allow the committee to incorporate as a Company Limited By Guarantee. We plan to put this into effect from 1st January 2020.
As a company limited by guarantee there will be certain matter that we will need to set up in the chart of accounts and attendant reports. I understand that it will be necessary to set up a new account with Quickfile as the template we currently use cannot, apparently, be modified for use as a limited company
IDENTIFYING NON TAXABLE AND TAXABLE INCOME
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The clubs total income is unlikely to exceed £5,000 per annum - it is after all, an amateur radio club and operates strictly on a ‘not for profit’ basis. Unless the Government changes the MTD regulations, it seems unlikely that we will fall under the requirements of MTD
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Almost all the funds arriving as ‘income’ are from the members, either in the form of membership subscriptions or payments for training courses. As such, my understanding is that any surpluses arising are not subject to tax however any deficits cannot be used to relieve any trading profits.
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Occasionally, the club does engage in fee earning consultancy. Where this does happen any costs associated are set off, but there may be trading profits that arise which may be taxable
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The chart of accounts will need to reflect that the need to account for both surplus and deficits on members funds as well as trading profits
EXISTING DIRECT DEBITS
We will need to migrate our existing membership records over to the new Quickfile ledger (assuming that a new ledger is absolutely necessary)
However, about half of our members pay their subscriptions by direct debit. Ideally it will be possible for these to be migrated over by Quickfile, but this will depend on
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Whether we keep the same bank account (probably yes)
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Whether Qucikfile and/or GoCardless are able to transition the records and mandates from the old ledger to the new.
In other aspects the accounting implications are largely under our control and are just a matter of ‘elbow grease’
I would be grateful if you could consider the above and make any observations regarding the implication for becoming a company liited by guarantee vis-a-vis Quickfile accounting considerations.
Kind regards
Mike
