This is a collaborative post.
Tax is a subject some of us get a little bit scared about, especially being self employed. In the early days it can be tough to justify the cost of getting an accountant, particularly if have low earnings in the first year. Despite this, I love working for myself and this is another challenge to face and a new skill to learn. This year I submitted my first tax return. I spend time each month updating and organising my accounts to make it a really easy process for myself. Here are my top tips for keeping those accounts up to date.
Top Tips for Tax and Accounting
- Keep a small, plastic wallet or envelope in your bag. Anytime you go on a business trip, work in a coffee shop, get a train to an event you can add the receipts and tickets into the envelope. On the first of each month, go through it, add it to your books and file them.
- Make use of spreadsheets. This is a simple and effective way to keep track of any incomings and outgoings.
- Have a date each month where you will update everything. This could be the first or last day of the month.
- Speak to an accounting firm that specialise and offer a Taxation service.
- Use a budget planner and clearly mark personal and business expenses.
- Create an invoice template. This can be done quickly on word or you can use a free invoicing service which will help you easily track your money.
- Don’t do your tax return last minute. It will stress you out.
Self Employment Tips
You can easily register as self employed through HMRC and they will give you all the information to register for a tax return. Your tax return needs to be completed by January 31st if using the online system. If you are completing a paper tax return you need to get this done by October. Your first tax year is the first year you operate as a business and the tax year runs from April to March. My first tax return was for 2015-2016 which I submitted in January 2017. In January 2018, my tax for 2016-2017 will be due. This has been a better business year for me, so keeping on track of things have been really important.
I hope these tips have been helpful. Are you self employed? Do you have any top tips for keeping your accounts in order?
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