Everything You Need to Do to Prepare for Self Assessment
Your first (or second, third, fourth...) Self Assessment tax return can look and feel very daunting. But the reality doesn't have to be the case. Don't worry, in this blog we're here to reassure you that the process isn't as overwhelming as you might first think by guiding you through everything you need to do to prepare for your Self Assessment.
So, what is Self Assessment?
Self Assessment informs HMRC of how much Income Tax and National Insurance you need to pay as a self employed individual. To complete your Self Assessment, you'll need to enrol for it before completing and submitting it to HMRC, usually done online before the 31st January deadline each year. Any Income Tax and National Insurance needs to be paid by this deadline too. If you miss the deadline to register, submit your return or pay your bill, you’ll get a penalty.
Get Yourself Legally Set Up
First up, it's time to set your business up by legally registering it. The route you take with this depends a little on your goals, set up and finances. Take a read of our blog Sole Trader or Limited Company for some help and guidance with this age old accounting question for new businesses.
If Sole Trader is the right fit for you and you'll need to fill out a Self Assessment, you will need a unique taxpayer reference (UTR) number. This only needs to be done once and it's advised to do this early on. You can register here.
Collect Your Information
Here's a look at some of the key information and paperwork you'll want to pull together:
Some of the key documents you will require include:
Records of your pension contributions
Any documents relating to business expenses
Your interest earned on savings and accounts
Any gift aid payments
P60, P11D, and P45, where applicable
Rental income records
Dividends earned from investments and other income
Records of capital gains
This information will be vital when it comes to filling out your SA100 form.
Hire an Accountant
If you're feeling in over your head, it could be time to hire an accountant for your business and Self Assessment. They'll take the stress out of your finances, from registering with HMRC to submitting your SA100 - and everything in-between. Your accountant is there to help you save money and time, allowing you to focus on what you love doing in your business.
If you'd like to chat about how an accountant could best support you and your own circumstances, we recommend booking in a free no-obligation consultation call. Give Catherine a call on 01423 431889 or email email@example.com.
Please note: all stats are accurate for the 2021/22 tax year.