How To Limit Your Stress This Tax Return Deadline
If you are a self-employed sole trader the chances are you dread January as you haven’t yet filed your self-assessment tax return. If you have, great news you will not be one of the millions rummaging around drawers for receipts in January!
Getting this monumental task completed early is no mean feat. But it is possible to get through the tax season without experiencing a stressful sprint to 31st January.
Here, Mike Parkes from GoSimpleTax explains how.
Gather all information soon
Don’t delay get the required data together now. Make a checklist such as the one below to ensure you have everything avoiding unnecessary delays.
Documents and Information Checklist. (suggested format)
| Documents/Information | Found | Need to Find |
| National Insurance Number | ||
| Unique Taxpayer Reference number or UTR | ||
| Business/partnership name, address and company number if relevant | ||
| P45 | ||
| P60 | ||
| P11D | ||
| The business’s annual income and expenditure | ||
| Income earned from other employment | ||
| Any rent they have received | ||
| Interest paid on loans, credit cards or other credit | ||
| Income from overseas | ||
| Income received from a partnership | ||
| Any dividends received | ||
| Benefits received either from the state or an employer | ||
| Capital gains received | ||
| Gift Aid received | ||
| Pension contributions | ||
| Tax payments they have already made this year (payments on account) |
If you have an accountant or bookkeeper filing your return ask them to sign and register the 64-8 form earlier rather than later. This will make them officially recognised as your agent by HMRC, and able to act on your behalf.
Know what you need
You have your checklist of standard data required, but you may require extra information.
Perhaps you have a student loan. Maybe you (or your partner) are claiming Child Benefit. If there’s the slightest possibility your circumstances will affect how much tax you need to pay, you should be aware.
INsiders receive a 10% discount off GoSimpleTax – Get started today and your discount code will be emailed to you.
Be aware of possible penalties
Submitting the Self-Assessment late comes with penalties, so be aware of these and know how you will need to provide all the necessary data to ensure they avoid them.
Check for mistakes now
It’s possible that, when you have gathered your information together, you may have missed something out or made an error.
So, once you’ve collated everything you need look at it as soon as possible. You’ll want to guarantee that nothing doesn’t quite add up or has been excluded.
Minimise errors with tax software
The chances of any mistakes can be reduced through Self-Assessment tax return software. It will take all the administrative work off your hands, ensuring the numbers are correct.
Think ahead for Making Tax Digital
With MTD over the horizon begin converting to a software such as GoSimpleTax and utilise their income tax calculator and submission tool for your business. Giving you full visibility of your tax liability in real time whilst giving and reviewing your pension contributions and investment opportunities.
About GoSimpleTax
GoSimpleTax supports the self-employed and sole traders all over the UK to file accurate Self-Assessment tax returns. You’ll be able to do so quickly as well – their software automatically calculates income, expenditure and tax owed in real time, and from a variety of devices.
Why You Should Go Digital For Your Self-Assessment
You will always find people who prefer paper-based accounting and self-assessments, reluctant or uninterested to learn to use new tools, they prefer physical copies over digital documents. But this could come at a cost.
By transitioning to digital, your accounts will be easier to manage and they’ll take a fraction of the time to process, enabling you to work on other elements of your business.
We’ve asked Mike Parkes from GoSimpleTax to explain more, and highlight how you can benefit from going paperless.
Real-time answers
Paper, by nature, is chaotic. You’ll need to file and accurately record your accounts – up to six years of your accounts, in fact, to ensure that you are covered if HMRC launch an investigation into your tax return. That’s sure to take up a lot of space, and it also doesn’t provide you with an easy-to-access overview of what you owe the taxman.
Digital files, on the other hand, are much easier to read. Especially if you invest in a tax return solution like GoSimpleTax. Tools like these allow you to record your income and expenditure in real time, meaning that whenever a you wish to know your tax liability it is available in a few short clicks.
Plus, as some tax return software providers also highlight any opportunities to claim tax relief, there’s an extra incentive for you to stay on top of your record-keeping.
Record income more easily
Another benefit of going digital is the ease with which you can record your income. At the moment, you have to log each of your paid invoices into your tax returns. But with invoicing tools, that all changes.
By using software to request payment, any invoices paid will automatically update your accounts. For example, if you receive a payment for an invoice you sent, your predicted tax bill will be automatically updated based on the amount of that payment. This saves you time and also unifies two of your businesses most important admin tasks: invoicing and the tax return.
Digital tools can also be used to understand when to schedule sending invoices as well as the follow-up emails to ensure that customers pay on time. Integrations with online payment solutions like SumUp and PayPal can additionally help your customers pay you more quickly using a debit or credit card, saving you from chasing payments in the first place.
Each of these payments will then filter into your tax returns, making the 31st January tax return deadline much easier.
INsiders receive a 10% discount off GoSimpleTax – Get started today and your discount code will be emailed to you.
Be MTD-ready
Last but not least, going digital means you’ll be ready for upcoming legislation. Making Tax Digital (MTD) was a government initiative launched in 2019 to gradually digitalise the UK tax system. It started with MTD for VAT, which stipulated that VAT-registered businesses with a taxable turnover above the VAT threshold would need to digitalise their accounts by 2022.
Soon this will extend to all self-employed individuals with an annual income above £10,000. The reason for this is that the government believes, by using software to submit tax returns, there will be fewer avoidable mistakes. These mistakes cost the government £8.5 billion in 2018/19.
By adopting this software now, you’re well ahead of the MTD for Income Tax roll-out date. So, not only will you be compliant with the incoming legislation, but you’ll also benefit from a streamlined workload well ahead of your competitors.
About GoSimpleTax
GoSimpleTax software submits directly to HMRC and is the solution for self-employed sole traders and anyone with income outside of PAYE to log all their income and expenses. The software will provide you with hints and tips that could save you money on allowances and expenses you may have missed.
Trial the software today for free – add up to five income and expense transactions per month and see your tax liability in real time at no cost to you. Pay only when you are ready to submit or use other key features such as receipt uploading.
3 Tips To Help Female Entrepreneurs Stay Safe
3 Tips To Help Female Entrepreneurs Stay Safe
The lifestyle of the entrepreneur can be a rocky road, and women face their own set of challenges in this regard.
For example, analysts assert that the coronavirus has disproportionately affected female entrepreneurs, citing that they were a third more likely to work in a sector at risk of shutdown. According to data in the same source, they were also more likely to be furloughed, and 47% more likely to lose their job entirely. It’s a tough time for all out there, but for the women of the business world, it can be even tougher.
There are also questions to consider when it comes to the personal safety of female entrepreneurs, also. No one should feel under threat as a basic principle, but additionally, when everyone is comfortable and content, that’s when people perform their best work too.
With all of this in mind, here are 3 tips to help you stay safe as a female entrepreneur.
Install Better Security
Security is the most important line of defence when it comes to safety.
To maximise the security systems around your business premises, consider investing further into CCTV design and installation. A great way to do this is by working with one of the leading multi-service security providers in the UK, First Response Group. They’ll help you develop cost-effective security solutions for your enterprising needs and are equally as open to one-off assignments as they are to long term B2B relationships. They can even provide security guards to patrol your premises just in case you want some extra assurances.
It’s all about awareness, deterrents, and peace of mind. Once you have all the appropriate arrangements in place, you eliminate much of the risk and dangers that comes with business ownership.
Encourage an Open Dialogue
Sometimes, enforcing a safe working environment means building each other up and confiding in one another.
If there is an open dialogue between entrepreneurs and across all levels of a workforce, then everyone will know how to behave and what precautions to keep in mind. Moreover, when people feel like they can speak up with their concerns, in their doing so they can be helping others with their enquiries.
Obviously, entrepreneurs are at the top of the line-up, but that doesn’t mean you can’t ask questions of your workers either. No enquiry is silly or unnecessary, and when everyone has each other’s backs, great things can happen. Nurture a culture of care, and you’ll keep each other safe.
Hire Cleaning Services
Considering the pandemic, staying safe now also means keeping workplaces spick and span.
Depending on your line of work, this may have been a requirement of your workplace pre-COVID-19. However, now everyone is rightly held to the same high standard. Hiring a professional cleaning service will help to ensure your workplace is clean and tidy all year round.
4 Solutions No Business Should Go Without
In these uncertain times, it can be difficult to be a business owner. The coronavirus pandemic has caused major uncertainty and disruption to most industries and we will likely be feeling the effects of this for years to come.
Here are a few ways that you can invest in and protect your business for years to come.
Technology
This one is key and is one that has been thrown into sharp relief by the coronavirus pandemic. We are living in a fully digital world now and given restrictions on visiting brick and mortar shops, online sales and services have boomed.
Your business will need a good, professional website to showcase your talents and services. Your website should be dynamic and engaging – where possible make sure to update and tailor it regularly to keep it at its very best. Making use of features like blogs on your website can help you to showcase your knowledge and expertise and is great for keeping customers informed.
No matter your business, you will find technology out there to help streamline and improve your operations, which can end up saving you significant amounts of time and money. Make sure you do your research and find the very best technology out there.
Good Accounting
Accounting is vital for a successful business. Where possible you should aim to enlist the help of a professional to help with your accounting. This will leave you able to focus on your business and what you do best.
A good accountancy service will keep on top of legislation and regulation. This is their specialty and is invaluable to business owners who often don’t have time to oversee details of accounting in the same way they would in other elements of their business.
Check out these accountancy services for some great ideas on what to look for in an accountant. They can help ensure that your accounts and taxes are in order and ultimately save you money and time while providing peace of mind. Good accounts will also provide valuable insight into areas where your business is excelling and areas that need attention and improvement.
A Social Media Presence
As with technology in general, more of us than ever before are engaging on social media. This makes it an invaluable tool for marketing and promoting brand awareness.
Many people when looking for new products and services check a business’s social media pages to get a feel for the company and its ethos. Providing engaging content can be incredibly helpful to show that you are knowledgeable and that you truly care about your customers.
Social media can also be a great way to gain reviews and recommendations. You could try running social media campaigns to increase brand awareness and get social media users engaged.
Nurturing Talent
A business is only as good as its people. You need to make sure you are attracting the very best in your industry.
Making sure your business is a desirable place to work is key to ensuring you find the right talent for roles. This isn’t just about paying well, though that certainly helps. You need to stand out from your competitors by offering a good work environment.
It can help if you provide some things that other offices don’t. This can be any number of things such as break rooms with games like table tennis to bean bags for more dynamic working to using standing desks to promote staff health.
Progression opportunities are also key to attracting and retaining the best talent. If you make your place of work somewhere that they can thrive and grow for years to come you are far more likely to receive employee loyalty and dedication in return.
Top Alternative Investments for Today’s Business Women
Investing can provide an effective way to maximize capital and generate an additional stream of revenue. Of course, the trickiest part of investing is deciding exactly what to invest in and what level of risk to take. If you want to move away from traditional options, like stocks and shares, take a look at these three alternative investments that are ideal for today’s businesswomen:
1. Cryptocurrency
If you already have experience in Forex trading, investing in cryptocurrency could be a natural transition. Buying, selling, or holding digital currency allows you to increase your capital, providing the value of your currency rises. To do this, you will need a secure cryptocurrency wallet to hold your funds.
2. Seed Investments
Becoming a seed investor gives you the opportunity to grow your capital and use your business expertise to help other entrepreneurs succeed. Millions of startups are actively looking for funding and many of them present lucrative opportunities for the right investors. When you can use your professional experience to help grow the company, you increase the likelihood of generating an impressive return.
3. Peer-to-Peer Lending
As the financial industry evolves, people are borrowing money in different ways. Peer-to-peer (P2P) lending gives you the opportunity to loan funds to borrowers and to generate a return in the form of interest. Numerous P2P lending marketplaces are already up and running, so it’s easy to establish yourself as a lender. Furthermore, you can choose to lend as much or as little as you like, so you can familiarize yourself with the process before you decide whether to invest a significant amount.
Are Alternative Investments Risky?
The level of risk involved in alternative investments varies. P2P lending, cryptocurrency, and seed investing are considered relatively high risk but there are other alternative investment opportunities that are lower risk. Real estate is considered to be an alternative investment, for example, but is rarely seen as high risk.
Although many alternative investments do involve a moderate or high level of risk, this does mean that they can offer high returns too. While you may not want to invest all of your capital in a high-risk investment opportunity, it could be an effective way to diversify your portfolio and increase your returns.
Finding the Right Investment Opportunity
The right investment for you will depend on a number of factors, such as the amount you want to invest, the level of risk you’re comfortable with, and how quickly you want to withdraw your funds. If you’re unsure what type of investment is most suited to your needs, it’s well worth getting professional advice. By talking to a financial adviser or an investment manager, for example, you can create a bespoke portfolio that matches your goals and gives you the best chance of growing your capital.
Do I Need To Complete The Self Assessment? How To Know If You Have A Tax Return Due
If you are classed as self-employed or have a source of untaxed income, you will be required to complete a Self Assessment. However, this criteria is vague and many are left confused as to whether they actually need to file the tax return or not.
GoSimpleTax’s Technical Director Mike Parkes provides clarity on the process…
Main types of self-employment
Typically, being self-employed relates to those who are a sole trader, part of a business partnership or director of a limited company. The latter two will definitely require a tax return to be completed.
If you’re a contractor using an umbrella company, it might not be necessary to file a Self Assessment as they are technically your employer. Those who are employed and undertake freelance work as an additional source of income are still classed as self-employed and will need to file a tax return.
Selling online
Those who carry out self-employed work as a sole trader will only need to submit the tax return if they earn more than £1,000. The same applies to those online sellers whose sales total exceeds this amount.
Even if you’re selling some possessions to earn extra cash, rather than build an online empire, you may be required to complete a Self Assessment and pay any tax owed on the income. There may even be Capital Gains Tax due if an item is not a car.
Renting out property
If you’re a landlord earning £2,500 to £9,999 (after allowable expenses have been deducted), you’ll be required to file a tax return. This requirement also takes other factors into account, such as additional income from employment or a pension. Potentially, small rental profits can avoid the Self Assessment and be handled by HMRC if they approve a request to adjust your PAYE code.
To work out your taxable rental profits, you first need to determine the type of renting. Rules differ for each situation: renting a room within your main property, letting a furnished holiday letting, and renting out foreign property or one in the UK whilst you live overseas.
INsiders receive a 10% discount off GoSimpleTax – Get started today and your discount code will be emailed to you.
Being a Minister of Religion
Even though Ministers of Religion are technically employed and paid via the payroll of the Church, they are required to submit a tax return. On top of this, there is an additional form (SA102M) specific to this role which will need to be filled out.
The Church will supply you with a P11D form at the close of every year – this details the taxable benefits and reimbursed expenses you’ve received. Those expenses paid for by the Church can’t be claimed on, but any paid by you have the potential to be offset.
Other circumstances
There are a few other situations that would require the submission of a tax return. These include income from savings and investment or if you earn foreign income.
Foreign income may also require you to complete the supplementary SA109 pages. There is specific criteria around this – you would be taxable on a remittance basis. You will also be taxable if you’re classed as a non-UK resident, not usually a UK resident, or have dual residence.
Other businesses are permitted to stay open – this includes those providing essential goods or services, including: food shops, supermarkets, garden centres and certain other retailers providing essential goods and services. Essential retail should follow COVID-secure guidelines to protect customers, visitors and workers.
About GoSimpleTax
GoSimpleTax software submits directly to HMRC and is the solution for self-employed sole traders and anyone with income outside of PAYE to log all their income and expenses. The software will provide you with hints and tips that could save you money on allowances and expenses you may have missed.
Trial the software today for free – add up to five income and expense transactions per month and see your tax liability in real time at no cost to you. Pay only when you are ready to submit or use other key features such as receipt uploading.