Accounting for your Corporation Tax in the app ensures your financial statements, balance sheets, and tax estimates remain completely accurate. Depending on your business setup, you can easily log this tax yourself by generating a manual bill, or you can let your professional accountant handle it automatically using secure digital journals. This guide walks you through both methods to keep your limited company's bookkeeping perfectly tidy and compliant. 📊
Option 1: Managing your tax bookkeeping yourself
If you handle your own bookkeeping without an accountant, you can log your Corporation Tax by matching a manual bill against your final tax payment. Follow these steps:
Calculate the exact Corporation Tax amount you need to pay to HMRC for the period.
Create a new bill in the app for that specific amount, setting the bill date to the very last day of that financial year (for example, 31 December).
Assign the bill to the Corporation tax cost category.
Make your tax payment directly to HMRC from your business account, and categorise that outgoing transaction as Corporation Tax liability.
Match the completed HMRC payment to the manual bill you created in step 2 to close the balance. ✅
Option 2: Working with an accountant
If you have already given your professional adviser secure, view-only access to your financial data, they can handle the core adjustments for you:
Your accountant will calculate your precise Corporation Tax liability based on your recorded transactions.
They will post an accounting journal in the system dated to the end of your financial year to debit your Corporation tax cost and credit your Corporation Tax liability.
Once you make the actual payment to HMRC from your account, you simply need to categorise the outgoing transaction as Corporation Tax liability to keep your books balanced. 💼
If you want your adviser to manage this process for you but haven't connected them to your account yet, you can easily learn how to give your accountant secure access here. 🤝