Income Tax Returns

[PJK]

Hi
I am a sole trader, NICEIC approved contractor and no employees, turnover last year was less than £40,000. Last year I paid an accountant £500 to do my tax return and accounts. This year work has been slower and I was considering trying to do the tax return myself. My question is to others in similar positions, do you do your own tax return.
I would be interested in your responses.
Peter

 

[telectrix]

what's income tax?

 

[PJK]

Whats income?

 

[cloverman]

Leave all that to my accountant ! Well worth the money in my opinion, takes all the hassle away from you and they know what you can/can't claim for !

 

[Adam W]

I do a self assessment tax return every year. Mine isn't that complicated so I do it myself.
The first year I did it I took it into the tax office where a very helpful lady checked it for me, although she made it clear she wasn't doing the job of an accountant. I asked her if it was worth getting an accountant and she said considering I'm a sole trader with fairly straightforward accounts, hiring an accountant would be a waste of money.

 

[telectrix]

i even pay my dogs a wage, £1000 a year + food + petplan insurance.( each). they are employees.

 

[PJK]

They do have the appearance of an excellent alarm system!!

 

[telectrix]

taxman was ok with the rotty, but couldn't get him to accept the chiwawa ( my lady's dog. i can't even spell it.

 

[Octopus]

Hi
I am a sole trader, NICEIC approved contractor and no employees, turnover last year was less than £40,000. Last year I paid an accountant £500 to do my tax return and accounts. This year work has been slower and I was considering trying to do the tax return myself. My question is to others in similar positions, do you do your own tax return.
I would be interested in your responses.
Peter

How much tax & NI did your accountant claim to have saved you?

£500.00 sounds steep - how about asking your accountant for a discount or finding a cheaper one?

 

[SirKit Breaker]

Hi
I am a sole trader, NICEIC approved contractor and no employees, turnover last year was less than £40,000. Last year I paid an accountant £500 to do my tax return and accounts. This year work has been slower and I was considering trying to do the tax return myself. My question is to others in similar positions, do you do your own tax return.
I would be interested in your responses.
Peter

Look for a cheaper accountant mate. I pay £330 inc Vat all in. Last year i got back a large portion of over £700!.

Cheers.........Howard

PS my accounts are all done with my accountant by email and post, she is very good PM me if you want her deatils.

 

[oldtimer]

I do a self assessment tax return every year. Mine isn't that complicated so I do it myself.
The first year I did it I took it into the tax office where a very helpful lady checked it for me, although she made it clear she wasn't doing the job of an accountant. I asked her if it was worth getting an accountant and she said considering I'm a sole trader with fairly straightforward accounts, hiring an accountant would be a waste of money.

Me too I also do my books every day yes every day so no running about like a headless chicken try to find invoices after all its not rocket science you are allowed to earn £7200 a year tax free so thats £600 a month you pay your NI every 3 months then you have your class 2 after you have earned £7400 so what profit you earn in a month you take £600 off and then put aside 30% for tax this is generous but when you do your self assesment at the end of the year its a Brucie bonus when the tax calculated is less what you have allocated.

Also as for accountants I strongly advise keeping away from guys who have a BMW and capped teeth

 

[PJK]

She says that she did save me money but did not quantify any amount. I have asked for a cheaper rate due to lower turnover, she has yet to get back to me. I do not think I will use them again. Will likely have a go myself and get HMRC to assist me.

 

[PJK]

Thanks Howard I will keep that in mind and appreciate your offer.
Peter

 

[VoltzElectrical]

Me too I also do my books every day yes every day so no running about like a headless chicken try to find invoices after all its not rocket science you are allowed to earn £7200 a year tax free so thats £600 a month you pay your NI every 3 months then you have your class 2 after you have earned £7400 so what profit you earn in a month you take £600 off and then put aside 30% for tax this is generous but when you do your self assesment at the end of the year its a Brucie bonus when the tax calculated is less what you have allocated.

Also as for accountants I strongly advise keeping away from guys who have a BMW and capped teeth

That'll be class 4 not class 2. Class 2 are voluntary, class 4 are income based (8%) of TAXABLE income which occurs AFTER allowances (£7400 ish) and deductibles (car/ van, tools etc).

 

[VoltzElectrical]

I pay about £200 for my tax return. Just give the guy a shoe box with everything in ( receipts/ invoices/ cis statements). last year I had £2500 back, year before £3500, and so on. worth EVERY PENNY of my £200.

 

[Octopus]

"That'll be class 4 not class 2. Class 2 are voluntary, class 4 are income based (8%) of TAXABLE income which occurs AFTER allowances (£7400 ish) and deductibles (car/ van, tools etc)."



Sort of right. Its 8% of nett profit on everthing over £7400 (ish)

 

[VoltzElectrical]

"That'll be class 4 not class 2. Class 2 are voluntary, class 4 are income based (8%) of TAXABLE income which occurs AFTER allowances (£7400 ish) and deductibles (car/ van, tools etc)."



Sort of right. Its 8% of nett profit on everthing over £7400 (ish)

Isn't that the same thing? Surely Net profit is what would deemed to be taxable income, ie what you earn after allowances and tax deductible costs?

 

[the pict]

I use a tax software thingy I just keep adding things to it till it says " you have no tax to pay" only kidding but there are some great accountacy software packs out there for lot less that the 500 brick your paying an accountant, make sure it a HMRC approved product though
Pict

 

[telectrix]

i had one orf those software packages frfom the bank. about as much use as a fart in a thunderstorm. tried it out and it took 50 times longer to enter anything than it did with pen and accounts book ( simplex D)

 

[Richard Burns]

I set up an excel spreadsheet that once I put on sales costs and purchases does a running total of tax due (if any) and state of the business (bad). This gives me all the numbers I need to supply to the tax man at year end (well that's the idea anyway)
The HMRC are actually there to help and they do give quite good advice, I generally look at the business-link pages and get the main idea for allowances etc.and then try and wade through the reams of strange information on the HMRC site.

 

[oldtimer]

That'll be class 4 not class 2. Class 2 are voluntary, class 4 are income based (8%) of TAXABLE income which occurs AFTER allowances (£7400 ish) and deductibles (car/ van, tools etc).

Yep apologies I have the figures as you mentioned on my spread sheet I should have checked the correct ammount before I went to press

 

[oldtimer]

i had one orf those software packages frfom the bank. about as much use as a fart in a thunderstorm. tried it out and it took 50 times longer to enter anything than it did with pen and accounts book ( simplex D)

I spent a tenner on a spreadsheet accounts from diy accounting I use 3 spread sheets and because I am a sole trader I zero the VAT part spread sheets are
Sales this records my milage and sales plus itemises my work A for independant and B for letting agent this tells me at a glance where my income is coming from it also give me a running total.
Purchases This records and itemises all purchases ie materials telephone stationary
Banking does what it says on the tin

I just use the same spreadsheets from year to year I have also made up a running total spreadsheet that I fill in every month also I fill these sheets in every day and place all receipts in a folder and they are all in order for easy reference I also back them up every other week to a memory stick as after working with PCs for 26 years I still do not trust them

 

[JL_Electrical]

If you do a fair few jobs as a CIS subcontractor and then a fair few as a "main contractor" ie no CIS. Then with the right accountant you should be a fairly happy man come January. Mine is worth his weight in gold

 

[piggyitm]

You need to pay tax up front (CIS) to be able to claim anything back.If your all invoices, you'll just be adding another £500 receipt to your collection.