Hi there
Does one pay one's income tax according to when money for work is received or does one pay tax when the work is done?
For example, let's say that I invoice someone for work done on December 4 2008 but do not receive payment until January 2009. Should the tax owing on the payment be paid for 2008 or 2009? Can I make the choice myself?
When I registered for VAT, was asked if wanted to opt for invoice method or the cash receipts method (ie, when the work was done or when I was paid for the work). Chose the latter. However, can't find any such info on the question of income tax.
Would suit me to pay income tax on the invoice method (with the new 1% levy next year, I'm better off paying it rather than putting it off until next year). Like I say, can I choose?
Thanks in advance
Does one pay one's income tax according to when money for work is received or does one pay tax when the work is done?
For example, let's say that I invoice someone for work done on December 4 2008 but do not receive payment until January 2009. Should the tax owing on the payment be paid for 2008 or 2009? Can I make the choice myself?
When I registered for VAT, was asked if wanted to opt for invoice method or the cash receipts method (ie, when the work was done or when I was paid for the work). Chose the latter. However, can't find any such info on the question of income tax.
Would suit me to pay income tax on the invoice method (with the new 1% levy next year, I'm better off paying it rather than putting it off until next year). Like I say, can I choose?
Thanks in advance