Practical advice for your business
It’s somewhat traditionally for accountants to offer lots of tax tips for their clients and to show off the breadth of their knowledge.
We have decided to keep it down to a more manageable 6 tips. That’s because we know that you just need the ones that you could in to practice quickly and easily. So here goes.
- Get into the habit of keeping your records straight. That means retaining receipts for expenditure, looking after invoices and recording business mileage, for instance. The pay off is reduced hassle when you want to submit company accounts and submit tax returns, and a greater chance of minimising your tax bill. Hang on to your records for at least 6 years just in case HMRC comes calling.
- Claim for all of the allowances that the you and the business are entitled to. That could mean anything from using the Capital Allowance Scheme to get 100% allowance on the first £500,000 worth of eligible expenditure to making sure that you claim for professional expenditure on journals, training and books. Remember that could include newspaper or magazine subscriptions.
- Sole traders should consider setting up a limited company. There are a number of important benefits but the most eye-catching is that if you are making over £20,000 pa you may be able to reduce your tax bill.
- Use an accounts package. You can use spreadsheets to deal with your tax administration (and we can provide MS excel templates if you need them) but if you employ staff or have more complex financial arrangements then use specialist software. The latest web-based systems are available on a pay as you go basis and could save you lots of time. Lewis Smith & Co are qualified partners for Xero so we can help clients set-up and run their system.
- Set aside your taxes. Unless you talk to them in advance HMRC are not very tolerant about non-payment of taxes. It makes sense to put aside money to cover VAT and Corporation Tax because they frequently catch small businesses out.
- Don’t be late.Understand what the deadlines are for all tax, National Insurance and Companies House reporting and paperwork, and make sure that everything is submitted accurately and on time. Penalties will be incurred for late submission and the later you are the stiffer they become. Where submission involves payment then you may become liable for interest too.
These are suggestions that you and your team can put into practice on your own. Of course if you need any help then contact Andrew or Craig at Lewis Smith & Co. today.
Call us on 01384 235549 or email firstname.lastname@example.org
Lewis Smith & Co. – Account preparation for sole traders, companies and charities