Amazon Reselling, Blogging, eBay Reselling, Everything Else, Freelancing, Selling Lego

I’ve been submitting a self assessment tax return for over five years now. At a time it was a rather daunting task for 20-something however, thanks to new cloud software such as Xero this process has been made simple and straight forward. While my tax affairs have become more complicated in recent years forcing me to hire an accountant.

 

For a long time I committed to becoming a ‘Jack of all trades’ and saved myself some serious cash by doing so. April marks the end of the tax year once again, which is exactly why I want to share with you the very basics of a self assessment tax return. I hope that by doing so I can help you to save time, money and hassle.  

Who Needs To Complete A Self Assessment Tax Return?

Not everyone needs to complete a tax return. The majority of UK tax payers have their tax collected at source through the Pay as You Earn Scheme. This is where employers run a payroll scheme that deducts the correct amount of tax and national insurance each month.

 

The employer is then legally obliged to pay this amount over to HMRC every month or every three months depending upon their size. There are however many reasons as to why 7 million people in the UK need to submit a self assessment tax return to HMRC.

 

Below are the most common;

 

Income above £2,500 from Land or Property

 

Company Director or If you are self employed

 

Income from a pension and a salary 40% income tax payer and have savings income

 

Receive an income from investments that are not taxed at source.

 

Income from foreign sources Income subject to capital gains tax

 

Just remember this is just a few examples. If you are unsure as to whether or not you should be completing a self assessment contact HMRC directly.

 

When Does The Tax Year Start? And End?

The tax year runs from the 6th April until the 5th April each year.  

When Do I Have To Submit My Tax Return?

I believe the deadline is very generous. HMRC give you until 31st January to submit and pay your return. That’s around 10 months!

 

Yet many still fail to meet that deadline and by doing so receive penalties for doing so. Many of us also leave it to the last minute. Causing unnecessary stress and running the risk of being unable to submit the return on time.

Save yourself from this self assessment embarrassment  

How Much Does Submitting A Self Assessment Cost?

If you’re willing to put in the graft and do all the work, record keeping and mathematics yourself then submitting your self assessment tax return to HMRC is totally free. However, remember time is money and it’s often all about finding the best of both worlds.

 

You can outsource your self assessment return entirely to a bookkeeper or accountant. This could cost anything from £300+ per year. It’s entirely dependent on the accountant you choose and your personal circumstances.

 

However, I found the middle ground for myself was using the cloud based accounting platform Xero. It cost less money than an accountant, but also required less work than doing the entire thing myself. Time vs Money for me personally it was a winner!

 

Where Can I Learn More About Self Assessment?

I remember when I first went into the world of self employment. It was a first for anyone in my family, and being young at times I found it confusing and hard to understand. HMRC knows this is often the case regardless of your situation which is why they host regular webinars.

 

Just remember that if you’re confused or for whatever reason don’t understand you should always contact an accountant or HMRC directly. They’ll be able to tailor the answer to your particular circumstances, ensuring that you’re always submitting your self assessment forms correctly.   I hope this latest post has given you some insight into submitting your own self assessment tax form.

 

The most important thing to remember is to complete your form as early as possible, and keep on-top of your record keeping. This is going to really reduce the time it’s going to take you to complete your return whether you choose to use an accountant, cloud based accounting services or do it yourself.

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Amazon Reselling, Blogging, eBay Reselling, Everything Else, Freelancing, Selling Lego


I've been using Xero as my cloud based accounting platform of choice for the past four years now, and heres why.

Xero is a beautiful, easy-to-use online accounting software designed for small businesses. I have personally been using the software since January 2015 when I ventured into a world I knew very little about – self employment.

  

Since then it’s allowed me to understand the financial situation of my business, save time, save money and plan accordingly for the future. I can’t recommend it enough (which is why you’ll often see me go on about it in Facebook groups & on Youtube hangouts)



I therefore decided it was long-over due that I dedicate an entire post to a Xero review. Explaining exactly why I use Xero for my cloud based accounting. Clearly, I’m not the only fan of Xero as their community is made up of more than 862,000 subscribers in over 180 countries. 

 

Accounts

In this Xero review I’m going to start with perhaps one of the most basic and yet profound features this online accounting service offers. It’s ability to be able to link my bank and credit cards as well as my PayPal account. Updating them all in Xero in real time.

 

No more logging in to check all of your business bank accounts. Load Xero up and you can be assured that all your accounts are completely up-to-date. I can see the overall financial possition of my business on one screen – not a calculator or spreadsheet in sight!

 

To link Xero together with your bank account is as simple as logging into your online banking. No more wasting your time writing down your expenses or exporting and importing CSV files. With Xero your income and outgoings are right there in front of you.

 

The reconciliation Xero offers also allows you to create ‘rules’ allowing you to select what certain transactions should be catagorised into. This not only saves you time but reduces the risk of human errors. 

 

Integration 

If the ability to work together with your bank wasn’t enough maybe the integration with almost 500 different applications might be. In this section of my Xero review I’m going to be talking about everything from SqaureSpace to Shopify and Gusto to Debtor Daddy (and everything in between!)

 

All this is designed to allow you to customise your Xero experience exactly to your businesses needs. Giving your the opportunity to connect with other time saving applications from advanced solutions for point-of-sale, time tracking, e-commerce and more!

 

Support

Aged just 20 I began my life as a self-employed entrepreneur. I knew very little about accounting, taxes and everything in between. When I got set up on Xero I had questions;

 

Why does this do this?

 

Why isn’t this doing that?

 

Am I doing this right?

 

If like me you’ve never done this before it’s super overwhelming and confusing. Luckily Xero’s support team was here to help every step of the way. I’m not just talking about being there for the few weeks where I was getting set up.

 

Just recently my business became a limited company, I was back to square one with one-million and one questions, again Xero’s amazing team was here to help… best of all it was quick, free and the amount of support they provide is unlimited.

 

Mobile

Xero also comes complete with a mobile application. This mobile application allows you to view your businesses financial situation whilst on the go or out and about.

 

It’s made all the difference when I find a business opportunity whilst on the road allowing me to see exactly how much I can afford to invest without restricting my business further.

 

Cost

When starting up a new business we all know how important it is to save money wherever possible. I wanted to be in full control of my financial situation. I didn’t want to hand everything over to an accountant who wanted to charge me £150 a month for the privilidge. 

 

Instead I opted for one of Xero’s three price plans;

 

Starter – £10 per month Ideal for bloggers or those who are just starting out.

 

This allows you to reconcile 20 transactions a month. Enter 5 bills Send 5 invoices

 

Standard – £22 per month My personal choice and more than enough for most small-businesses.

 

Reconcile unlimited transactions Enter unlimited transactions Send unlimited invoices

 

Premium – £27.50 per month If you conduct transactions in a currency other than your local (UK – GBP / US – USD)

 

Everything standard offers plus multi-currency transactions. Take Xero up on their 30-day free trial to find out which service might suit your needs best.

 

Bookkeepers & Accountants

As your business grows and your needs change you may find yourself needing some further accounting assistance in the form of a bookkeeper or an accountant.

 

What’s great is that with Xero being a cloud based platform your person of choice can access your books at any time. You are also able to keep in full control of your financial situation and make decisions accordingly.

 

If you think finding someone with the knowledge and experience who is also a Xero professional is going to be tough, think again. Xero have created this fantastic interactive tool to find the best person for the job, local to you.

 

Security

The final part of my Xero review is dedicated to security. Afterall, your handing over very sensitive information in regards to your business. Which means security has to be tight… and it is. Xero’s platform is run with a secure SSL encryption. SSL encryption is the exact same as what your bank uses, so with security as tight as your bank. You can be sure you’re sensative information is in safe hands.

 

I do hope you enjoyed this Xero review. If you’re still unsure then be sure to take them up on their 30 day free trial to find out if they are right for you. If you go ahead and sign up then be sure to let me know in the comments.

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