Accurate record keeping is key to keeping track of your portfolio finances and to see the health of the finances. Getting your record keeping and day-to-day management right at the start will save you time.
Keeping track of expenses and more importantly future liabilities, such as taxes, will help to ensure that you retain enough cash to avoid any surprises.
You also need an audit trail for anything that HMRC is likely to require records for, and these records need to be kept for at least six years. It can sound complicated, but simple tracking can ensure you have all the information you may need at your fingertips.
With Provestor you'll be keeping track of many of your records as you use the software day to day.
HMRC require you to keep records of your tenants including the dates you let out your properties. You can create tenancies in Provestor and capture all the information needed for complete records.
Income records are important to HMRC and for accurate taxes and accounting. With Provestor it's easy to create and send invoices for rent for any services you give to tenants (e.g. charge for maintenance or repairs).
With the modernisation of banks and Open Banking this has become easier. You'll need to keep or have access to 6 years of bank statements should HMRC request to see copies.
Expenses can sometimes be the most difficult items to keep track of from a business perspective but there are some sure-fire ways to ensure that you track them quickly and properly.
Ensure that you use your business bank account to pay for all of your portfolio expenses; this is a better separation of your expenses from your personal spending
Make sure you keep the receipts safe either digitally or in their original paper form
A note on expenses: There are rules regarding what constitutes a business expense for tax purposes. HMRC is clear on what is an allowable business expense: “The costs you pay with the sole purpose of earning business profits are allowable expenses”.
We’re talking specifically about business mileage in this section. If you are using public or hired transport, this is covered in the expenses section above as there is an audit trail of receipts.
For business mileage is it important to track and log the journeys accurately. You do need to ensure that the mileage claimed can be supported by information showing the purpose of the journey.
We've made this easy for you - within the expenses feature of Provestor you can record all the important information in your mileage log and easily reimburse the expense.
If your company will pay anyone a salary, they will be on your company payroll. This means you'll have a PAYE scheme setup for your company and will submit payslips to HMRC electronically every month.
All the records required by HMRC are submitted in realtime by our software so your records are taken care of.
If a company will pay its shareholders dividends from company profits, it's important they are formally recorded as dividends. This means that dividend vouchers must be produced.
When you want to pay a dividend, Provestor has everything you need and will generate the records to ensure you are compliant and don't vote illegal dividends.
Large sums of money move around when a property is bought or sold so keeping documentation for your records is important.
Keep any documentation safe related to the sale or purchase including mortgage offers, solicitors fees and stamp duty.
Our accountants will need copies too so we'll upload them to your secure document store for you.