The Federation of Small Businesses (FSB) reported a record of 5.5 million private sector businesses at the start of 2016. The growth of SMEs in the UK is a huge benefit to our economy – these businesses stimulate growth, bring innovation and diversity to our business landscape and many are ‘early adopters’ at the forefront of technology, using tools that enable them to focus on what matters most: running their business, and nurturing their craft.
But year after year like clockwork, so many self-employed workers and small businesses race to complete their self-assessment (often in a frenzy). Completing taxes on time is integral to the smooth running of any business. And while I always advocate planning ahead and using tools to alleviate manual labour (think: sorting receipts out of a shoebox!), here are some considerations to hit the deadline if filing your self-assessment has fallen to the backburner.
To Expense Or Not To Expense?
Once you have collected and organised all of your relevant receipts and documentation, find out what you are eligible to expense and the tax reliefs you can claim. There are a range of different expenses, from allowable and simplified expenses, to business expenses and capital allowances. For example, simplified expenses allow you to calculate some business costs with a flat rate instead of working out the actual costs. These include the costs associated with transportation, working from home, and living in your place of business. I recommend visiting the HMRC website for a helpful overview that can help save you time.
Don’t Be Afraid To Ask For Help
With the deadline nearing, guessing and going at it alone might in fact prove more costly than seeking expert advice. If taxes are giving you a real headache, don’t hesitate to bring in an accountant for complete confidence that you’re filing your taxes correctly. Better yet, their expertise can set you up for success in years to come.
When was the last time you picked up the phone to order a taxi, or visited a bank branch to check your balance? You already use a host of apps to help you manage your time effectively day to day, and accounting should be no different. Historically, accounting has been an exercise of looking in the rear-view mirror at what’s been done, but the rise of intelligent, cloud-based technology is fundamentally changing this. Now, accounting software can help business owners anticipate what’s ahead, and free up accountants to deliver valuable, consultative advice rather than simply mind the books. Look for solutions now that can add ease and simplicity to future returns to avoid repeating the cycle again next year.
In future, the government hopes to streamline this process with Making Tax Digital (MTD). This will require small businesses and the self-employed to file taxes digitally on a quarterly basis. Once the self-assessment deadline has come and gone, bear in mind that it’s never too early to prepare for forthcoming changes. Taking a proactive approach to managing your accounts now will help your business become future-ready.