How to manage your tax affairs in line with HMRC regulations

Tax, Taxes, Tax Return, money

 

When you start working for yourself you should tell the tax office straight away, because there will be forms to fill in for national insurance contributions and similar statutory payments. If you go to www.HMRC.gov.uk you will land on the home page, from where you can navigate to any area of the tax system you want, including frequently asked questions, which cover most of what you will need to know. How you manage your tax affairs and how complex your self assessment return will be will very much depend on what your ideas for working for yourself are. If you are planning to run a very small one person (ie, you) business in a few hours a week from home, it is likely that you will be able to manage your tax affairs yourself. If you are taking on staff, thinking of forming a limited company or sub-contracting; it would probably be sensible to see an accountant, at least in the first year of trading.

If you are on a low start up budget, you can get a lot of advice from the Citizens’ Advice Bureau. You would have to check locally, but most of them run workshops with local experts so you could get a lot of free advice from an accountant or tax lawyer if you speak to the CAB in advance and book a slot. The main thing they will tell you of course is that anyone running or looking to start a business should keep immaculate records and keep to deadlines. If you do both of those things, you can’t go wrong if your business plan is a simple one. If you take out business financing, your bank will probably help you with your tax planning. Look around for a bank which offers legal advice as part of its start up packages for new businesses. Some of them give away quite a lot of hours of advice for free and this is worth any amount of gadgets and gizmos offered by others so it is worth shopping around.

If space is tight and you are running your business from a single shelf in the dining room, a good idea is to scan paperwork and save it in a dedicated folder on your computer. If you are fairly computer literate, it is worth buying a program which will help you keep the right records. They are not usually expensive and sometimes can be downloaded free from websites. They will help you make sure that you have all of your financial records at your fingertips and this, alongside the HMRC website guidelines, should ensure that you will be able to deal with any taxation requirements for your business efficiently. If you take advantage of any free courses which may be offered by your local Chamber of Commerce to top up on your knowledge, you should be able to run your own accounts without the need for an accountant. Remember that accountant’s fees are tax deductible!





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