Help on self-employed accounting pls!!

[kleila]

Hi there,

It is probably a quiestion that has been answere many times, however I woul like to ask your help.. I am about to start up my nail business from home as a self-employed. I do know that I have to register with HMRC as self-employed.
How do you keep record for tax assessment? Is the cash receipt book good for this purpose? Is there any forms I need to fill out in order to support my tax return?
Do you have a business bank account? Which one would you recommend that has low fees.
At the end of the year I will be on maternity allowence, do I have to interrupt my self-employment or does anyone know how that affects my maternity allowence.

Many thanks,
kleila

 

[jes]

Hi, It's a bit of a broad subject to cover in one go so here's just the basics.

To put it simply you have to show and prove your turnover (takings) and your expenses to HMRC. From those two things HMRC or yourself (if you wish) can work out you taxable profit (turnover minus expenses).

Turnover means all money taken by you and your expenses are the costs needed or used to keep your business running (but not your wages).

For recording takings I have a sheet of A4 divided into days of the week. At the end of each day I record how much money I take in cash, cheques, card payments and tips etc. It's also handy to keep a record of how much was on sales/retail and services etc. I then staple the Z reports over that day. At the end of the week I tally it all up and enter it into a speadsheet.

Expenses are simply your receipts from buying consumables etc but also includes utility bills and running costs. Somethings need to be thought about before declaring for tax e.g. don't claim 100% of a telephone bill for business when the bills show 50% of the telephone calls are to friends and family or outside working hours:lol:.

Apart from that you must keep all reciepts, bank statements, cheque book stubs, even your appointment diary. Do get a business account or at least one that is totally separate from any personal use.

I'm not too sure about your maternity allowance, but I think it now means you have to claim something else (maternity pay?) but you will still stay self employed thoughout.

Something else that might be helpful is to take a look a the self assessment part of a tax return. It's what you'll have to fill in at the end of the tax year for self assessment (although it will have changed slightly by the time you get one). You can download it here http://www.hmrc.gov.uk/forms/sa103s.pdf

hth
jes

 

[jotommo]

i only pat £120 a year for an accountant and its so much less hassle!!!
i keep everything said above and give it to her in the best order i can (i am a bit of a nightmare lol)
as for maternity i got about £106 a week?!? i think?? and its statotory maternity allowence,, payable ONLY if your nat. insurance is up to date xxxxxxx

 

[kleila]

Thanks very much for your help... I think I can see it a lot more clear now.