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.
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.
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.
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.
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.
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.