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Recognising income

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Recognising Income

June 2005

After centuries of confusion accountants, HMRC and law drafters are approaching an understanding.

 

The latest stages of this will affect professional firms more than others but the general principal is worth highlighting as many in business are not aware of the rule that income is recognised in accounts and for tax purposes as it arises, ie as and when the work is done.  This applies whether or not you’ve issued an invoice or even received payment and can apply to part completion of the work.

 

 

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