An Expense Report is a form that is used to report business expenses that must be incurred to run the business. The Expense Reports are typically used by the employees of the company to report various business expenses incurred by them out of their pockets. So basically, an Expense Report is a form through which the employees request reimbursement of all the business expenses incurred by them on behalf of the company. The employees typically attach receipts for the expenses incurred that go beyond a minimum amount with the Expense Report. Furthermore, the business entity scrutinizes the Expense Reports submitted by the employees to check for their correctness and validity. On finding these as the authorized business expenses, the business entity may reimburse the amounts so requested by the employees via the expense reports. Post reimbursement, the business entity can record the reimbursed amount as business expenses that impact the accounting profit and the taxable profit of the company. What Should An Expense Report Include? As stated earlier, an Expense Report is a document that itemizes or breaks down the business expenses incurred by the employees on behalf of the company. Further, it requires the employees to attach the receipts associated with such expenses. An Expense Report can include various details that are particular to your business entity. However, various fundamental details must be included in an expense report. These are as follows: Date This is the date on which the expense was incurred. Such a date matches the date specified on the receipt for such an expense. Vendor This is the name of the Vendor from whom a specific item was purchased or the one whose services were availed. Nature This relates to the type of expense incurred like meals, air tickets, car rental, etc. Total Amount This is the total cost of an expense incurred including taxes. Such an amount matches the amount specified on the related invoice. Account This refers to the account to which such an expense is to be charged. That is the customer for whom such an expense was incurred. Business entities commonly use Account Numbers to represent customers. Description This is a brief account of what each of the business expenses are all about. Sub-Total For Each Expense These are the sub-totals for each type of business expense included in the Expense Report. This turns out handy for the bookkeeper to update such information into your accounting software. Why Do We Need Expense Reports? There are a variety of purposes for which Expense Reports are needed. These include: Tracking Expenses Over a Reporting Period Expense Reports help you to understand how much you are spending as a business entity in respect of specific expense categories. Thus, you are able to see if any particular expense category is leading to increasing your costs. Reimbursing Employees As mentioned earlier, the employees associated with small businesses typically incur expenses out of their pocket and ask for reimbursement of the same expenses. Thus, you need a proper system in place to ensure that the claims being demanded are authorized business expenses. This is where the Expense Reports come handy. They itemize the expenses which give you an understanding of when, where, and on how these expenses were incurred. Do Your Taxes Effectively Many expenses incurred by your employees while at work are tax-deductible. However, you cannot claim tax deductions for such expenses till the time you have a proof of the same. With the help of Expense Reports, you can keep a track of these tax-deductible expenses which might not reflect in your bank account history. Thus, this makes it easy for you to claim tax deductions for such business expenses during the tax time. Source: https://quickbooks.intuit.com/global/resources/expenses/expense-report-template/
Due to the rapid spreading of COVID 19 across the globe, the Government of Jamaica has recently implemented the COVID Allocation of Resources for Employees (CARE) Programme. The CARE programme is a temporary cash transfer programme to individuals and businesses to cushion the economic impact of the COVID-19 pandemic. There are currently nine components under the said programme from which workers, small businesses, students and other individuals may apply. Considering our operation, we will be focusing on the benefits, eligibility and application process for the following components: SET Cash (Supporting Employees with Transfer of Cash) COVID-19 General Grants COVID-19 SMALL BUSINESS Grants SET Cash About SET Cash This option assists individuals who have been laid-off or terminated since the first COVID-19 case in Jamaica, March 10, 2020, with a temporary cash transfer of $9,000 per fortnight. As such, individuals who apply and qualify will be awarded $9,000 per fortnight. This payment, however, will be remitted to the individual on a monthly basis. Who is eligible? Individuals who were employed prior to March 10, 2020 and statutory deductions were paid on their behalf. Individuals who were laid-off or terminated on or after March 10, 2020 and will be terminated before June 30, 2020. Supporting evidence of termination will be required in the form of a P45 form. This should be uploaded by their employer with the names and taxable incomes of all former employees temporarily laid-off or terminated. Individuals who were earning income less than or equal to $1.5m per annum as verified by RAIS Tax Administration System. How can I apply? A two-step verification process will be employed as follows: Step 1 - You will be required to complete an online application form beginning Thursday, April 9, 2020 via the www.wecare.gov.jm portal. In addition to other necessary data, applicants will be required to provide their name, address, TRN, name of employer, date they were laid-off or terminated and certification that their taxable income is less than or equal to $1.5 million per annum. Step 2 - Your employer will be required to upload a P45 form with the names and taxable incomes of all former employees temporarily laid-off or terminated. Benefits Once an individual’s application has been received and their eligibility information verified, a sum of $9,000 per fortnight will be transferred to the individuals on a monthly basis. As such, anyone who applies in April and qualifies will, therefore, be eligible for April, May & June and will receive the stipulated transfer each month. When can I apply? Application opens Thursday, April 9, 2020. COVID-19 General Grants About The COVID General Grant of a one-time amount of $25,000 will be available to barbers, hairdressers, beauty therapists, cosmetologists, market vendors, taxi and bus operators (i.e. PPV licensees) who are registered with a Municipal or Transport Authority by April 30, 2020. The COVID General Grant of a one-time amount of $40,000 will be available to bar and night club operators who are registered with a Municipal Authority by April 30, 2020. The COVID General Grant of a one-time amount of $40,000 will be available to craft vendors, JUTA, MAXI and JCAL operators who are registered with the Tourism Product Development Company by April 30, 2020. Who is eligible? For barbers, hairdressers, beauty therapists, and cosmetologists: evidence of being licensed or registered with a Municipal Authority at any time over the last two years April 1, 2018 – April 30, 2020. For taxi and bus operators (i.e. PPV licensees): registration with the Transport Authority by April 30, 2020. For bar and night club operators: registration with a Municipal Authority by April 30, 2020. For craft vendors, as well as JUTA, MAXI and JCAL operators: registration with the Tourism Product Development Company by April 30, 2020. How can I apply? Persons in the above occupational categories will be able to apply online beginning April 9, 2020 via the www.wecare.gov.jm portal (on a computer or mobile phone). In addition to other necessary data, businesses will be required to provide name, TRN, address, registration or license number and bank account information to facilitate payment. Benefits Barbers, hairdressers, beauty therapists, cosmetologists, taxi operators, bus operators and market vendors who apply and qualify will receive a one-time Covid19 General Grant of $25,000. Bar operators and night club operators who apply and qualify will receive a one-time Covid-19 General Grant of $40,000. Craft vendors, JUTA, MAXI, and JCAL operators who apply and qualify will receive a one-time COVID-19 General Grant of $40,000. COVID-19 SMALL BUSINESS Grants About All small businesses with sales of $50 million or less, who filed taxes in the 2019/20 financial year, and who filed payroll returns indicating that they have employees, will be eligible for a one-time COVID Small Business grant of $100,000. Who is eligible? A business will qualify for a small business grant if the business had average sales less than or equal to $50 million per annum for the 3-year period 2017-2019 must be a registered business which has filed tax returns for the year of assessment 2019 financial year filed payroll taxes which indicate that it has employees and this is verifiable in the form of the revised SO1 form via the RAIS Tax Administration System. How can I apply? Small businesses will be able to apply online via the www.wecare.gov.jm portal (on a computer or mobile phone). beginning April 9, 2020. In addition to other necessary data, applicants will be required to provide name, address, TRN, and banking information of the small business in addition to similar information from the signatory to the application. All applicants who receive a small business grant are ineligible to receive any other grant under the CARE Programme. Benefits A business that applies and qualifies for a COVID Small Business Grant will receive a one-time grant of $100,000 paid within 30 days of application. For more information about the CARE Program feel free to visit: www.wecare.gov.jm If you are still not sure if you qualify for the grant, you can call (888) 4WE-CARE for further clarification. Take care and keep safe!
8 Most Common Small Business Mistakes: 1. Not taking bookkeeping seriously 2. Business owners mix personal income with their business income 3. Trying to manage everything yourself. Know your strengths and weaknesses 4. Covering small expenses out of pocket without recording 5. Not maintaining proper records. Original receipts are either misplaced or discarded. 6. Not properly planning for tax season and tax liability 7. Not consulting with an accounting professional for guidance 8. Failing to make a budget. There are many more mistakes but these are the popular ones. Small business accounting mistakes are not small and can dissolve the business in the long run. Don't make these mistakes. Contact us for help at (876)707-8172 or info@pcsjm.com.
Whether a business is operated as a company, self-employed entity, partnership or any other type of organization, good record-keeping practices should be adopted for five main reasons: 1. Well-kept records may shorten the length of time an income tax audit takes to be completed. 2. It can help you get loans from banks and other creditors. 3. Keeps you better informed about the financial position of your business. 4. It can mean tax savings, as it can be used as a reminder of deductible expenses and credits. 5. It can help to verify all your business expenses for tax audit purposes.
A pension is basically a long-term savings plan with tax relief. Getting tax relief on pensions means some of your money that would have gone to the government as tax goes into your pension instead. The tax relief would be most beneficial to those who are earning more than the current income tax threshold of $1,500,096 per annum. If you contribute to a pension scheme (Approved Superannuation Fund or Retirement Scheme) your regular contributions are invested so that they grow throughout your career and then provide you with an income in retirement. A maximum of 20% of your annual gross taxable income or emoluments can be contributed to a pension scheme prior to attaining the age of retirement, 65 years. Most employers have a group pension plan for their employees. However, most self-employed, contract workers or those employed who are not contributing to a group pension plan are not contributing to an approved pension scheme. We are encouraging these groups of persons to contribute to an approved pension plan so that you can benefit from the tax relief and also have another source of income in retirement.
Do you want to know how your business is performing? Looking at your sales/income alone does not give you a true reflection of your profitability. Let us help you with your accounting services so that you can have accurate information to make meaningful decisions. Did you know that businesses that maintain proper accounting records are more likely to - pay less tax at the end of the year because all their business related expenses are accounted for; - make more informed decision about the business; and - is able to obtain loans from financial institutions.
We are offering on the spot tax preparation services to help you meet the March 15 Tax deadline. Let us help you avoid interest and penalty!
Tax deadline is March 15, 2019. Let us help you meet the deadline. Don't wait to get ready for tax season 2019. It may seem early but we only have one more month and couple days until the end of the year.
