I’ve received an inheritance from France this year that has already been taxed (by the French). How should I tag this amount so that it is registered correctly for attention of HMRC in my self assessment? I understand there is some agreement between the countries that means I don’t have to pay UK tax as well?
1.QF is mainly for bookkeeping and should not be solely used for tax filing.
2.Tax already paid UK or Foreign needs to be dealt separately
3.Tax Paid for inheritance can be broken down into 2 parts. A. The total inherited amount tagged as inheritance income which would require a separate ledger entry transferring the amount to your personal account.
B. Tax paid on that income would simply go into the tax paid ledger. Or Other creditors.
There are few points. The inherited is cash or asset. How you would want to deal with the figures would depend on final accounts. QF simply wouldn’t automatically manage that. Infact as far as my knowledge goes no accounting software can deal with complexities except for ERP systems and is required for you to hire an accountant or professional is preparing your tax return on which the adjustments can be shown.
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Apologies, I should clarify that I’m preparing my accounts for my accountant (not HMRC), so that everything is tagged correctly and placed in an appropriate place. This is my personal account that includes property portfolio.