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5 top tips on completing your Self Assessment tax return

Many freelancers and small business owners can feel intimidated at the prospect of submitting their Self Assessment tax return

Well, don’t panic. If you make use of the available tools and information, pay attention to the rules, and follow these tips, it’ll be less of a headache. And don’t forget that you can always ask a friendly accountant for help.

Make sure you’re registered

First things first. Before you can start the Self Assessment process, you’ll have to register with HMRC.

You need to create a Government Gateway account online before registering for Self Assessment. You’ll be sent a 10-digit Unique Taxpayer Reference (UTR) number that will be used on all correspondence and on your tax return. 

Once registered, HMRC will also provide you with an ID and password to access the system. That’s what you use to login and submit your assessment online.

Keep detailed records

You’ll be doing yourself a favour if you keep detailed records throughout the year. You need to keep records of:

  • All sales, income, and business expenses
  • VAT records if you’re registered for VAT
  • PAYE records if you employ people
  • Records about your personal income

While you don’t need to send your records in when you submit your tax return, you do need them to work out your profit and loss for your tax return and show them to HMRC if asked. So make sure you keep all invoices, bills, and receipts as proof to support your records.

Add regular time into your calendar to stay on top of your finances rather than leaving months of bills to reconcile at the last minute. Your future self will thank you for it.

Choose the right tools

There are no rules on how you need to keep records but it’s best if you choose a method that works for you and your business.

For some people, keeping a detailed spreadsheet using Google Docs or Microsoft Excel is enough. But there are many options on the market now to make keeping track of your income and expenses easier. 

Tools like FreeAgent, QuickBooks, and Xero can help you manage your finances. With built-in features including invoicing, time tracking, expenses, and more, these tools can help.

Understand what you can claim for 

HMRC has clear rules around what you can and can’t include as ‘allowable expenses’. Especially when it comes to things like travel, accommodation, entertainment, food and drink, clothing and the business use of your home. Make sure you’re fully up-to-speed with the rules so you can claim the right tax deductible expenses – and you don’t miss any! 

Add it to you calendar & make it a priority

When you’re busy running your own business, it’s very easy to put your Self Assessment right at the bottom of your to-do list. However, it must be done and delaying it could mean you end up with a £100 fine.

Your online Self Assessment tax return needs to be in by 31 January. Add this date to your diary but make sure you give yourself plenty of time to submit it just in case you get stuck and need to ask for help.

Don’t be afraid to ask for help

If the thought of submitting your tax return yourself fills you with anxiety and dread, you can get help. If you’re struggling to register or submit your tax return online, you can contact HMRC directly.

If for any reason you don’t feel 100% confident in submitting your tax return, you should check with a qualified accountant who can make sure that your submission is error-free, submitted on time, and making the most of the allowable business expenses.

So if you’re looking for a bit of extra help or want someone to take this off your to-do list completely? It may be time to consider hiring an accountant.