Bristol is the fourth most productive place in the UK and the West Country more generally is a hotbed of entrepreneurial spirit, so the concept of self-assessment is nothing new.
There were more than 39,300 people registered as self-employed in Bristol at the end of March 2018 and most will be preparing to submit a tax return, some for the first time.
If you’re one of those first-timers, there’s no need to panic as you’ve got plenty of time to get this done and we’re here to help you along the way.
According to Xero, 8% of small business owners wait until deadline day – 31 January – or the day before to compile their self-assessment tax returns, so the earlier you start, the less stressful it will be.
Self-assessment is the process for paying income tax on any earnings outside of PAYE worth more than £1,000 relating to the previous financial year, in this case 2017/18.
You can either manage this yourself or you can bring your records to our digital-savvy team of accountants who will take the task off your hands.
In the meantime, here are some helpful tips if you’re unfamiliar with the self-assessment process, or if you just need a refresher.
Registering for self-assessment
You only need to register for self-assessment if you’re going through the process for the first time. Those who’ve done this before just need their unique taxpayer reference (UTR) and their records from 2017/18 to get started.
Registration is done online. You’ll need your national insurance number and personal details, such as your address, phone number and business name, before you receive your UTR. Make a note of this number as you will need this for future reference.
Records needed for self-assessment
If you are self-employed, as a rule of thumb, you should keep all sales invoices and till rolls as proof of your income, plus receipts for all goods and stocks purchased between 6 April 2017 and 5 April 2018.
Bank statements or slips are also good supplementary evidence of your business’ cashflow during the tax year, while PAYE records are needed if you employ staff.
VAT records will only be required if your business is VAT-registered, and this is compulsory if your annual turnover in 2017/18 was more than £85,000.
There are full details of requirements about who must send a tax return here.
Submission methods and deadlines
You can go down the traditional route and join the 771,331 taxpayers who filed their self-assessment on paper last year, although be aware that the deadline for paper submissions is rapidly approaching — they have to be in by midnight on 31 October 2018.
More than 9.9 million taxpayers submitted their tax returns online last year, and this is our preferred method of filing self-assessment tax returns for our clients.
Not only is it more efficient but you also get an extra 3 months to get your return in ahead of the deadline, which is at midnight on 31 January 2019.
Feeling daunted?
Tax and accounting inefficiencies are among the biggest worries for small businesses, and having all your figures in one place in the cloud can go a long way to easing the stress.
Online accounting will make the process of recording your sales receipts and invoices so much easier.
As Xero Platinum Partners, we’re perfectly placed to handle all your self-assessment needs using the latest digital cloud accounting software. Our aim is to help you get your weekend back.
If the prospect of self-assessment makes you anxious, get in touch to see how our real-time accounting service can benefit you.
