Four Tax Preparation Tips to Follow

Four Tax Preparation Tips to Follow

If you want to avoid the stress of the tax period, follow these four simple steps to prepare your business in advance.

Tax season is one of the most stressful periods of the year for a business owner. With proper planning, however, you can change that.

It’s essential to start preparing for the filing of your business tax return in advance so you have time to gather all relevant records.

Take a look at the following tax preparation tips that can make the upcoming tax season less stressful for both business owners and their accountants.

Organise Your Tax Paperwork

Before anything else, it may be a good idea to sort out any past years’ documents, if you haven’t already. Start organising your books to make sure that you’re prepared when the paperwork starts to come in.

Tax paperwork should be organised by category and you may want to make copies of important documents received by post.

Categorise Your Business Expenses

Another time-saving tip is to start organising and categorising your business expenses weeks before the tax return due date.

You can claim most of your business expenses as tax deductions. But if you’re not sure which expenses you can claim, check out the official guide on HMRC’s website.

All business expenses must be sorted out and explained in detail. Finally, don’t forget to itemise your expenses.

Alternatively, if you outsource your tax preparation, you will want to hold on to all your documents for when it’s time for your accountant or accounting firm to prepare the tax return.

Check Whether You Can Get Deductions and Credits

Small businesses may qualify for a number of tax credits. However, don’t wait till the last minute. Check in advance whether you’re qualified for these credits.

Deductions reduce your taxable income and credits are even better, as they directly reduce the amount of tax owed. Your accountant or tax preparation software will have a list of tax deductions that apply to your business.

Get Help

Tax season is very stressful for your bookkeepers and accounting team, assuming that you have them on the payroll. Even if they’ve been doing great the whole year, they may need some extra help now.

A smart business owner won’t let his or her accounting staff burn out during the tax period. Ask them if they need help and if so, make sure to relieve the burden.

It’s essential to get your tax done correctly and on time, which is less likely to happen if you try to save money on accounting staff during this hectic period.

Advance Prep Wins Out

For most business owners, tax season is far from the favourite time of the year. However, it’s not an excuse for you to wait until the last moment to start preparing your tax return.

To avoid unnecessary stress, the best course of action is to prepare in advance.

It won’t trouble you nearly as much if you’re to find that something is missing, but that’s only possible if you leave enough time to sort things out.

Book a free consultation here, to learn more about our accounting services and how can help you grow your business.

4 Reasons Not to DIY Your Tax Return For Your Small Business

4 Reasons Not to DIY Your Tax Return For Your Small Business

As a small business owner, you may be used to taking the DIY approach. After all, you’re most likely a marketer, financial director, HR manager and payroll administrator, to name but a few of your many responsibilities. However, although your business may be small, there’s one area that really does call for professional help – and that’s filing your tax return. Let’s take a look at four of the main reasons you shouldn’t do your taxes yourself this season.

1. You’re Not a Numbers Person

We’d all like to believe that we’re good at absolutely everything, but the truth is that not everyone is good with numbers. If you don’t have an affinity for mathematics then doing your taxes yourself is probably not the best idea.

Even if you’re competent enough at everyday calculations, taxes are a whole different ball game. Calculating your taxes is a very complex process; there’s a reason that chartered accountants have to spend so many years in training.

A simple mistake on your tax return can cause you to pay the wrong amount of tax and even result in harsh penalties that can seriously threaten your small business. It really isn’t worth the risk.

2. It’s a Waste of Your Time

Taxes are notoriously time-consuming and as a busy business owner, your time is a precious resource that you can ill-afford to waste. After all, the time that you spend doing your taxes is time you can’t spend growing your business. It’s important to sit down and think about how much your time is actually worth before you squander it all trying to figure out your taxes. Think of time in the same way as you think of money, and learn to invest it wisely.

3. Tax Laws Change Constantly

Tax laws change all the time and it can be incredibly difficult to stay on top of all the latest rules and regulations – especially when you already have a business to run. When tax season rolls around, the chances are you won’t know about all of the latest changes which could lead to you making mistakes on your tax return or missing out on new opportunities to save money.

It’s an accountant’s job to keep up to date on any changes and then take advantage of these opportunities to save you money, so that you pocket as much of your income as possible. Remember that a quality accountant will always save you more than their wages.

4. The Internet is Full of Misinformation

In this day and age, the DIY approach to any task usually involves several Google searches. The problem is that although the internet is a wonderful resource, it’s full of incorrect or outdated information. As discussed, tax laws and deductions change all the time, so the article you’re reading may no longer be accurate. Furthermore, tax rules vary hugely from country to country, so you might end up making a mistake because you read advice that doesn’t apply to your business.

Sifting through all of this information and checking for veracity is a hugely time-consuming task, so you’re far better off working with a tax professional who has relevant experience within your specific industry. That way, you can have your questions immediately answered by someone who knows what they’re talking about and won’t have to waste time falling down Google rabbit holes.

Summary

The needs of every business are different, but if the above issues resonate with you then you should consider hiring an accountant when tax season rolls around. A great accountant is an investment in the financial health of your business, and will undoubtedly save you a significant amount of time, money and stress in the long run.

Are You Ready for your Tax Return?

Are You Ready for your Tax Return?

For small business owners, tax season can be a stressful and daunting time of year. It makes sense that you’d rather not think about it, but as a bookkeeper, every year I see business owners feeling stressed as the season approaches because they know deep down that rushing things and leaving it to the last minute can lead to mistakes and penalties. That’s why it makes sense to get ready for tax season right now. In this blog post, we’ll explore why now is the time to get your self-assessment tax return done, instead of waiting until the deadline of January 31st. We’ll offer tips on how to outsource your bookkeeping, why the deadline is not a target, and how it’s crucial to know your numbers to help motivate you to complete your tax return.

You don’t want to be doing your tax return over the holidays.*

It’s no secret that the holidays are a busy time of year – especially for small business owners. With the added pressure of balancing work and family commitments, it’s easy to put off sending your tax return until January. However, with the deadline of January 31st fast-approaching, don’t let yourself end up cramming your tax return in over the holiday period. Instead, tackle it now and enjoy a stress-free break.

The deadline is a deadline, not a target.

Many small business owners falsely believe that the filing deadline of January 31st  is a “target” rather than a firm deadline. This could not be further from the truth. The HM Revenue and Customs (HMRC) takes non-compliance very seriously, and failing to submit your tax return by the deadline could result in a fine. Get it done and off of the list as soon as you can.

Outsource your bookkeeping so you don’t need to do it.

One of the best ways to get your tax return completed now is to outsource your bookkeeping. If you don’t have the time or expertise to handle this task in-house, think about getting the help of a professional bookkeeper or accountant. Outsourcing your bookkeeping can not only save you time and energy, but it can also help you stay organised and ensure your tax filings are completed accurately and on time.

Here’s the unexpected benefit

Many small businesses see the tax return as the ultimate goal, but at InterTax we know that the most important reason to get your tax return completed now rather than later is to know your numbers. It gives you time to save for your tax bill if you haven’t already (talk to me about this, I can help), and it is key to knowing your numbers.

Your tax position reflects your business performance for a certain frame of time, and we expect you want to know how you’re performing in as near to real time as possible. Understanding your financial situation is vital in running a successful small business. By knowing your financial figures in-depth, you can make informed decisions for your business, plan for the future, and stay on top of your finances.

Conclusion

Getting your tax return done as early as possible is crucial. Of course, this avoids unnecessary added stress, mistakes and penalties, but it means you have feedback on how your business is doing. At InterTax we encourage our clients to file their tax returns as early as possible and we’d love to chat to you about how we can help you with yours. You can reach out to us by clicking https://intertax.co.uk/book-consultation/

So why wait? Let’s get your tax return sorted now so you can move on to more exciting things.

How to Prepare for Tax Season as a Freelancer

How to Prepare for Tax Season as a Freelancer

Tax season can be a stressful time for freelancers. There are many steps you need to take in order to make the process as smooth and easy as possible. In this blog post, we will go over how to prepare for tax season so that your taxes are filed on time, with all necessary documents included.

#1 – Track Your Income

The first step in preparing for tax season is tracking your income. The best way to do this is to keep  a careful record of your invoices and payments all year round. However, if you have neglected to do this then now is the time to get your books in order.

#2 – Track Your Expenses

In order to determine if you owe money or will receive a tax return, it’s important that you keep track of your expenses.  As mentioned above, if you have neglected to do this then now  is the time.

The best way to stay on top of expense tracking is to do it little and often. Cloud accounting software is a great option, allowing you to easily access your financial data from anywhere.

#3 – Understand Your Deductible Expenses

It’s important to understand  what expenses you can deduct from your taxes. Tax rules are notoriously complicated,  so it’s best to consult a qualified accountant for assistance. You don’t want to miss out on lucrative deductions and tax credits.

#4 – Organise Your Accounts

It’s important to be organized when filing your taxes. You need to have all of the necessary documents at hand, including bank statements and invoices.

You should also make sure you are up-to-date with any deadlines for submitting forms or information.

You can use cloud accounting software to easily organize your account information, as well  as provide you with reminders for filing deadlines.

#5 – Plan Ahead

It’s important to plan ahead and make sure you can complete your taxes as soon as possible. This will allow for the maximum amount of time to file all necessary documents, such as tax returns or information forms.

#6 – Use Cloud Accounting Software

There are many great cloud accounting options out there, including  Xero and Quickbooks.  These options will allow you to easily track your income, expenses, deductibles, accounts and filing deadlines in one place. They also make it easy to receive reminders about upcoming deadlines.

#7 – Choose the Right Accountant

It’s important to choose an accountant that specializes in working with freelancers and understands the ins and outs of your industry. An accountant who is qualified and experienced will be able to guide you through the tax process, ensuring everything is filed properly on time. They will also save you money by  finding you all available deductions and credits.

Of course, an accountant is not just for tax season but  should be a part of your year-round financial planning. Whether you are filing taxes for the first time, or have been freelancing for years, having an accountant can help save money and stress throughout the entire process.

Summary

By following these steps, you can ensure that your taxes are filed on time with all necessary documents included. By taking the time now to stay organized and plan ahead, you’ll be able to enjoy a stress-free tax season!

Book a free consultation here, to learn more about how our tax services can support you.

4 Reasons Not to DIY Your Tax Return For Your Small Business

4 Reasons Not to DIY Your Tax Return For Your Small Business

As a small business owner, you may be used to taking the DIY approach. After all, you’re most likely a marketer, financial director, HR manager and payroll administrator, to name but a few of your many responsibilities. However, although your business may be small, there’s one area that really does call for professional help – and that’s filing your tax return. Let’s take a look at four of the main reasons you shouldn’t do your taxes yourself this season.

1. You’re Not a Numbers Person

We’d all like to believe that we’re good at absolutely everything, but the truth is that not everyone is good with numbers. If you don’t have an affinity for mathematics then doing your taxes yourself is probably not the best idea.

Even if you’re competent enough at everyday calculations, taxes are a whole different ball game. Calculating your taxes is a very complex process; there’s a reason that chartered accountants have to spend so many years in training.

A simple mistake on your tax return can cause you to pay the wrong amount of tax and even result in harsh penalties that can seriously threaten your small business. It really isn’t worth the risk.

2. It’s a Waste of Your Time

Taxes are notoriously time-consuming and as a busy business owner, your time is a precious resource that you can ill-afford to waste. After all, the time that you spend doing your taxes is time you can’t spend growing your business. It’s important to sit down and think about how much your time is actually worth before you squander it all trying to figure out your taxes. Think of time in the same way as you think of money, and learn to invest it wisely.

3. Tax Laws Change Constantly

Tax laws change all the time and it can be incredibly difficult to stay on top of all the latest rules and regulations – especially when you already have a business to run. When tax season rolls around, the chances are you won’t know about all of the latest changes which could lead to you making mistakes on your tax return or missing out on new opportunities to save money.

It’s an accountant’s job to keep up to date on any changes and then take advantage of these opportunities to save you money, so that you pocket as much of your income as possible. Remember that a quality accountant will always save you more than their wages.

4. The Internet is Full of Misinformation

In this day and age, the DIY approach to any task usually involves several Google searches. The problem is that although the internet is a wonderful resource, it’s full of incorrect or outdated information. As discussed, tax laws and deductions change all the time, so the article you’re reading may no longer be accurate. Furthermore, tax rules vary hugely from country to country, so you might end up making a mistake because you read advice that doesn’t apply to your business.

Sifting through all of this information and checking for veracity is a hugely time-consuming task, so you’re far better off working with a tax professional who has relevant experience within your specific industry. That way, you can have your questions immediately answered by someone who knows what they’re talking about and won’t have to waste time falling down Google rabbit holes.

Summary

The needs of every business are different, but if the above issues resonate with you then you should consider hiring an InterTax accountant when tax season rolls around. Consider us an investment in the financial health of your business, who will undoubtedly save you a significant amount of time, money and stress in the long run.

Book a free consultation here, to discuss your needs and how we can help you.