Surviving Self Assessment

The self assessment filing deadline of 31 January is fast approaching. If you haven’t filed yours yet here’s a guide to help you get it done. 

 

1 HMRC references and logins

Check that you know your NI number and your unique tax reference number (UTR).  If you need to register as self employed you can do this here: https://www.gov.uk/log-in-file-self-assessment-tax-return/register-if-youre-self-employed.

You also need to ensure you have your Government Gateway password and login.

 

2 Identify all your difference income streams

This is helpful as it dictates what information you need to gather:

Top tip: use a different bank account for each main income stream and pay for any costs relating to that income using the appropriate bank card. This makes it a lot easier to keep a track of all your business costs rather than you (or your accountant!) having to trawl through your personal bank statements trying to identify those that are business related.

3 Collect your paperwork

Why do this now? The earlier you start collecting paperwork, the sooner you will identify anything that is missing and be able to obtain duplicates. Similarly if you use an accountant to prepare your return the sooner you give them the paperwork and the more time they have to ask you questions or flag anything which is missing.

Top tip: although we use the term ‘paperwork’ accounting records can now be kept electronically.  Set up a Dropbox or a Google Drive folder for your accounts with subfolders for each month and save documents to the appropriate folder as and when you receive them. Scannable is a brilliant app you can use on your phone to scan a document and then email to yourself or save directly to a folder in Dropbox.

4 Get your accounts up to date

If you are not using an accountant ensure your accounting records for your year are up to date.

Why do this now? If your books are not complete when you come to fill in your tax return you could pay too much tax, or equally you could pay too little tax and risk fine and penalties.  Also, if HMRC inspects your records, it can fine you for inadequate record keeping so make sure your books are kept up to date.

5 Make the move to the cloud

If you are not already using a cloud based accounting package now really is the time to do it!  They can make your day to day accounting so quick and easy.  Most have apps so you can even access your accounts on the move.  Take a look at Xero, Quickfile and Freeagent (if you have business banking with Natwest or RBS you can even get Freeagent for free!).

If you are VAT registered Making Tax Digital (MTD) comes into play from 1/4/19 and using MTD compliant cloud software is an easy way to ensure you are ready.

6 Find an accountant (if you don’t already have one)

An accountant can either prepare your figures for you or just check them over.  They can help you avoid tax traps and may be able to suggest some ways to save tax.  They can also speak to HMRC on your behalf once registered as your agent.

Why do this now? If you approach an accountant in January they will be busy and may be unable to take you on, or may charge a premium for doing so.  The sooner you approach an accountant, the sooner you can get the ball moving.

 

JLA Accounting Limited is a friendly, approachable and professional Chartered Accountancy practice based in Darlington, serving clients across the North East and the rest of the country.  The business is owned by Julie Allan and Katie Blenkharn, who both regularly attend Colleagues on Tap at Business Central, Darlington.

You can find lots of useful articles about accounting and tax aimed at micro-business in our blog: www.jlaaccounting.co.uk/blog.