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Be Prepared for Next Year\'s Tax Return

01 - 02 - 2017

What is the best way to prepare for next year's Self Assessment Tax Return?

 

Our Sales Advisor, Charlotte Wright, passes on a few tips now that the 2015/16 Self Assessment deadline has passed. 

We did it! We’ve finally hit the 31 January Self Assessment deadline! If you’re a business owner I’m sure you, like many of the Self Employed, ran around like a headless chicken trying to collect paperwork, receipts and other bits of information which need to be included in your Self Assessment. But what is the best way to ensure filing next year’s Self Assessment filing is a breeze? We have the solution!

 

1.       Keep Spreadsheets

Keeping spreadsheets is one of the best ways to keep track of any details of income and outgoings throughout the year. Create month-by-month tabs on a spreadsheet in order to know where you’re up to each month. Keep these in a folder, both on your computer and a physical folder.

 

2.       Retain details of all sources of income

If you have or had a PAYE job throughout the tax year, details of these will need to be included in your Self Assessment. These could be;

 

·         P60 received from any employment in the tax year;

·         P11D received from any employment in the tax year;

·         Bank Interest Statements;

·         Building Society Interest Statements;

·         P60 for any pension received;

·         Details of any pension contributions made

·         Any other details of sources of income

3.       Keep your receipts

Keep any expenses receipts you might have, such as any travel, meals and any personal expenditure that you incurred ‘soley, exclusively and necessarily in the course of business’. Keep note of any business mileage you have done, this can be from home to your client’s site or between sites during the day. If you have attended a relevant training course and had to drive there this can be included too. Driving to an accountancy practice can also be included, so all the more reason to come and visit the Foremans office!

When it comes to preparing your Self Assessment you’ll have everything you need in one place and all you’ll need to do transfer the information onto your Tax Return and complete your tax calculation. If you’re not the most organised person, it might be an idea to appoint an accountant to help keep everything in one place for you and help with all of your bookkeeping. This way you’ll save time and money when it comes to next year. It is said that a good accountant will always save you at least as much in taxes as you spend on their fees!

 

If you’d like further information email us at ContactUs@Foremansllp.com or call our office on 01244 625 500 

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Fixed Data

Assumptions

General                                                                                                                              

• The user is over 21 and subject to tax in the UK
• The user wishes to minimise their tax liability
• The user is subject to national insurance i.e.he/she is not over retirement age
• Only current tax rates and limits are applied
• No tax mitigation payments are made e.g. pension contributions
• Only 3 digit letter 'L' tax codes shown in the drop down list can be entered 
• The user does not have a turnover greater than £100,000 where fewer reliefs and or higher taxes may apply

Expenses

• All miles claimed as expenses are for business use using a personally owned car or van
• All other expenses claimed are wholly, necessarily and where appropriate exclusively for the benefit of the business

Foremans LLP Charges

• Foremans fees associated with Limited Company, Sole Trader or Umbrella are as per published rates
• Foremans current Service Costs are allowed for in all calculations.

Holiday Pay

• Holiday pay is accumulated week by week by Umbrella or Agency employer but paid out during the year

VAT

• Limited Company or Sole Trader will be VAT registered
• Limited Company or Sole Trader will take advantage of Flat rate VAT
• Flat rate applied includes the benefit of the additional 1% applicable to the first year of VAT registration

Limited Company Conditions

• One director / one shareholder in a Personal Service Company
• Director of Personal Service Company elects to vote for 100% dividend after salary, costs and expenses
• Director's salary is maximum salary to the primary threshold for NI
• The Limited Company is trading normally i.e it is not subject to IR35 and is not a Managed Service Company

NOTES

• The Current tax rates are taken from the Fixed Data Table
• The current Value Added Tax Rate is 20% and is applied to all invoices and expenses as appropriate
• The Director's Salary is fixed in relation to National Insurance thresholds. Higher Rate Taxpayers should consider the advantages and disadvantages of a larger annual salary or bonus
• Higher Rate Taxpayers may wish to consider the advantages and disadvantages of shared ownership of their business
• Users with a tax code other than three digits and letter "L" may telephone or email our Development Department to request a detailed calculation
• Generally the use of an Umbrella rather than an Agency payroll is only efficient if sufficient weekly expenses are allowable and claimed
• The expenses claimed under an Umbrella should not prevent the proper operation of National Minimum Wage