Small Business Self Assessment

If you are self employed and have started a new or small business, it’s important to be aware of tax regulations in the UK. One important tax consideration is the self assessment tax return form. This small business owner guide to self assessment will help provide the information you need to complete your tax return. From dealing with eligible expenses –such as understanding what you can and can’t claim tax relief for to having clarity of the Self Assessment process. What Is A Self Assessment? Self-assessment is the process where you the individual, inform HMRC how much money you’ve earned that tax year, alongside other details about your financial circumstances. This lets HMRC calculate work out how much tax and possibly National Insurance contributions you need to pay. In some cases, tax is deducted automatically from your wages or pension. However, if you receive any other income – such as from self employment, capital gains you will need to report this to HMRC by sending a self-assessment tax return. Self Assessment is required if you’re a sole trader, a partner in a partnership businesses or as a director. Self Assessment can also be used to declare money you receive outside of their employment such as savings, pensions, tips, commission, rental income, and so on. Do I Need To Complete A Self Assessment Form? There are some of the most common examples of people who usually do have to carry out self-assessment (but not limited to): Self-employed people People with more than one job People drawing a pension while continuing to work and earn Directors and partners of limited companies Anyone earning a certain amount from investments (including property) Ministers of religion People claiming child benefits who have earned above a certain amount Anyone who receives a P800 form Find out more if you need to do a self assessment form. Small Business Owners Self Assessment Records One of the most important things you’ll need to do to file an accurate Self Assessment is to keep comprehensive records. The sorts of things you’ll need to keep records of include:

• Self-employed income (you should include details of your invoices and business expenses)
• Income from employment such as a P45 or P60
• Dividends you’ve received
• Partnership income
• Interest from savings or investments
• Rental income
• Foreign income
• Pensions contributions
• Gift Aid and donations to charity
• Pension income
• Capital gains from selling shares and other assets such as crypto

  If you have difficulties with record keeping, MJ Kane offer a professional bookkeeping service to ensure your records and financial information are accurate and organised. Self Assessment Tax Relief For Small Business Owners There are certain expenses you can claim tax relief for in your Self Assessment, especially if these are personal transactions required to do your job. You claim for items, such as (but not limited to):

• Tools & Equipment: These can hardware, tools and respective maintenance costs.
• Accountancy fees: This can be for accountancy services and accounts preparation, submitting tax computations and accounts to HMRC
• Professional Subscriptions or Membership: If you are required to be a part of a professional body as part of your job, you can claim relief for this.
• Stationery: These can include paper, ink and other items
• Office equipment: These can include computers, laptops and softwares required to do your job.
• Clothing: These can include uniforms and respective cleaning fees

  Find out more on how to claim tax relief on Self Assessment tax return. Other Notable UK Tax The other main areas that will affect a new or small business are income tax, national insurance contributions, VAT and corporation tax. Income Tax If you are a sole trader or a partnership you will need to pay income tax on any profits from the business. In the case of partnerships, the profits will be divided between the partners and each party will pay tax on their proportion.If you employ staff you are legally required to deduct income tax and national insurance from their salary this is known as PAYE (Pay as you earn) Corporation tax If you are a registered limited company, you will be liable to pay corporation tax on any profits that the company makes. The company directors will still pay income tax on income they receive. If the company makes sufficient profit it can also pay its shareholders a dividend. National Insurance National Insurance contributions are required to support state benefits such as retirement, unemployment. If you employ staff, it is your duty as a business owner ensure that these contributions are made. Self employed individuals have a separate contribution scheme. VAT Value Added Tax (VAT) is a tax on most sales, services and imports. Some goods are exempt from VAT, these include insurance and education services. If your turnover is above the compulsory VAT registration limit (currently £85,000) and offers services which are not exempt, you will need to register your business for VAT. Can I Hire A Self Assessment Accountant? Yes, you can! Our team of tax and self assessment accountants are experts in UK tax legislation. Through MJ Kane, you can be assured your self assessment tax return is filed correctly and timely whether you are a small business owner or a director of a limited company. A professional accountant can ensure your are only liable for the correct amount of taxed owed. You can call our team on 028 9335 0290 or use the form at the end to submit an enquiry. Why Should I Hire A Self Assessment Accountant? Save time and hassle Completing a company tax return and self assessment form requires an intensive amount of time and record keeping to be able to complete it properly. Outsourcing this process to a self assessment accountant can save time that can invested elsewhere such as your business or family. Avoid frustration and confusion Like any tax issues, it takes time to work your way around the system and understand what is required from you. A self assessment accountant can help simplify this process. Avoid potential fines or late submissions Our self assessment accountants ensure that your form is submitted accurately so there are no risks of receiving fines or the attention of HMRC when filled incorrectly. We’ll also ensure to have effective time keeping so that everything is done well before any deadlines. Avoid mistakes and misinformation Filling it out correctly can be confusing, especially if you are new to all this. Mistakes can be made, and these can be costly. A self assessment accountant will review and ensure all information is correct before submission. Be up to date on tax legislations Tax legislation changes all the time, and our self assessment accountant are keep up-to-date with it so you don’t have to Get potential savings An experienced self assessment accountant will know where to find deductions so you could reduce your tax bill legally. There’s also the risk of paying too much tax if you fill in your Self-Assessment form yourself. When you use an accountant you may be able to save more money than you spend on the service, which could be hundreds of pounds or more. Professional record keeping A self assessment accountant can help you to organise your files to make the process easier and quicker in the next tax year. Our accountants can also provide tips on managing your finances to make record keeping and bookkeeping easier. Why MJ Kane For Your Self Assessment Accountant Over 8000 satisfied clients In over 30 countries 60+ industrial experience Your Own Dedicated Accountant Competitive Quotes Small Business Experts No-Hassle Solution Error-Free Accounting In house experts for all accounting needs You can get started with our Self Assessment Accountant Services by arranging a call back with our team on the form below. Alternatively, for urgent queries please call us at: Tel: 028 9335 0290

Self Assessment FAQs

What Do I Pay Taxes On?

• Money you earn from employment
• Profits you make if you’re self-employed – including from services you sell through websites or apps
• Some state benefits
• Most pensions, including state pensions, company and personal pensions and retirement annuities
• Rental income (unless you’re a live-in landlord and get less than the rent a room limit)
• Benefits you get from your job
• Income from a trust

What types of businesses do MJ Kane Accountants serve?

MJ Kane specialises in serving serves small and medium-sized businesses of all kinds (sole-trade, limited, partnership, contractor, charity etc..), but we are best known for our expertise in these industries:

• Professional services – Real estate agents, insurance agents, financial advisors and more
• Personal service contractors – HVAC technicians, plumbers, electricians, painters, mechanics and more
• Retail – Clothing store, e-commerce sellers, convenience stores, coffee shops and more
• Health and wellness – Gyms, salons, spas, dentists and more
• Restaurants – Quick-service restaurants, fine dining restaurants, coffee shops, caterers, specialty food providers and more

I am a Sole Trader, do I need to complete a Self Assessment?

Sole Traders are required to submit a self-assessment tax return.

I am a Partner in a partnership, do I need to complete a Self Assessment?

Partnerships are required to submit a partnership tax return, and each partner must also submit a self-assessment tax return.

I am a Director of a limited company, do I need to complete a Self Assessment?

Limited Companies are required to submit an annual return, CT600 company accounts, and directors are all required to complete a self-assessment tax return.

How Will Your Self Assessment Accountant Help Me?

Through our tax return accountants service, we will work to minimise any tax owed while preparing your Self Assessment. Our service is tailored for each individual but depending on your circumstances we can also claim for relevant expenses, allowances and tax reliefs on your tax return. We also offer a one-off tax advice where we can help you understand your UK personal tax situation.

How Long Do I Keep Tax Records In The UK

For individuals this should be a minimum of 5 years. For companies this should be a minimum of 6 years. You should ideally have a dedicated filing system for all records of historic years to ensure you can access any document easily.

How Do I Claim Tax Relief on Self Assessment?

Within the self assessment form there’s a series of supplementary pages, this is particularly important if you’re self-employed or receive income from another source – you’ll  use this section to help claim tax back from HMRC. Read more about how to claim tax relief on your self assessment

Do I need to complete a self assessment form if I am small business owner?

Yes. Small business owners are considered self employed persons and are required to complete a self assessment form so HMRC can tax earnings appropriately.

Learn more about self assessment for small business owners.

What Do I Need For My Self Assessment Form?