If you’re a small business owner, you’ll understand that while tax isn’t the most thrilling part of running a firm of your own, managing this area of your accounts efficiently is essential. From reducing stress levels to sidestepping unnecessary fines, small businesses can enjoy many benefits as a result of handling tax obligations in their accounts effectively. In the following sections, we’ll look at five useful points to remember when it comes to tax accountancy.
Never miss tax deadlines
As the owner of a small business, the accuracy of your annual accounts and the timeliness of submitting them is your own personal obligation.
If you’re operating via a limited company of your own, ensure you submit your business’ annual tax returns, accounts and Companies House paperwork correctly and on schedule to avoid having to pay a penalty.
If you’re operating as a partnership or sole trader, your self-assessment return will need to be submitted before the tax deadline outlined by HMRC, and tax liabilities that are due must be paid. If you’re the company’s director, or have income that is untaxed, you’ll also be required to submit a personal tax return as well.
Make and retain accurate records
Comprehensive accounting records must always be kept, with all of your small business’ receipts and invoices held somewhere safe. HMRC advises you should retain all accountancy records for six years. If you use accounting software, or a professional accountant, your data records will be automatically saved and secured, making this important process easier.
Claim any allowances you and your business are eligible for
Ensure any allowances your business and you as its owner are entitled to are claimed, whether it’s claiming assistance with business rates or capital allowances like the Annual Investment Allowance.
Additionally, you claim a nominal fixed sum when you work from your home without needing to submit receipts. A professional accountant can advise you on the business expenses you can claim for, mitigating the amount of tax you must pay.
Consider a different approach to VAT
If your business is VAT registered, it might be worth consulting an accountant to see if your firm would benefit from the Flat Rate VAT Scheme. This scheme can be a simpler way for your company to account for VAT, and it also offers a greater percentage reduction in the first year after registration.
Set tax money aside for returns
Account for the tax your small business will need to pay and keep it safe throughout the year, setting it aside from your other funds at regular intervals.
Do you require a small business accountant in Goole?
Whether it’s assistance with day-to-day bookkeeping or tax return services, Goole small businesses can count on our team at Adaptive Accountancy for any help required. You might be a limited company, a partnership or sole trader, but regardless of the way you operate, we’ll structure an accounting service that fits the way you work. Get in touch with us today for advice on more tax-efficient accounting and keep building your business.