How does inter-year accounting work?
The first time you go through the Taxoshi report wizard, you will be asked on the report configuration step to set which month your tax year starts and output currency you would like to generate your reports in. Once these are set, it can not be changed as each account needs to report on the same periods and financial jurisdiction for continuity of reporting.
It’s important you start by generating reports for your earliest tax year first and work your way forwards, even if this means going through the wizard multiple times. The reports are generated using FIFO (First In First Out) which to put simply means we take the oldest purchase and match it with the sale which we’re processing and the difference in value is the profit or loss. The FIFO calculation works across multiple years. Meaning if we’re processing a sale from the current tax year and you have a purchases we can match which was unsold from a previous tax year, we will use those purchases as the input for the profit / loss calculation before using ones from the current tax year.
This is in line with the guidance put out by Inland Revenue and is one of the main reasons why it is so important to have a complete data set and to start at the earliest year you are able to account for. If you don’t process your reports chronologically the calculator is likely to generate inaccurate reports.
Once a report has been generated it is considered finalised and locked in. There is no way to delete a report from your account because as explained, we need to use the data from the previous year to complete the following years report and removing reports would result in the loss of data continuity.
You can only generate one report per tax year per account to again prevent loss in continuity of the records. If you need to generate multiple reports for the same year, reports with different currency or with different tax year start settings you will need to simply register another account to do so at this time.
Questions & Answers
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