What is a current liability?
Definition of a current liability
A current liability is money that your business owes which it will have to pay within a year.
Examples of a current liability:
Classic examples of current liabilities are money that the business owes to HMRC, such as VAT or Corporation Tax and money owed to its suppliers, such as a solicitor or an accountant. Money owed to suppliers is also called 'trade creditors'.
If your business is a limited company, you will find its current liabilities are called "Creditors; amounts falling due within 1 year" in its statutory accounts filed with Companies House.
Where to find current liabilities
Current liabilities appear on a business's balance sheet.
Keeping track of your business's current liability
FreeAgent is a powerful double-entry accounting engine which can generate reports - including balance sheets - enabling you and your accountant to easily keep track of your business's liabilities.