Income Tax and Self Assessment for Self-Employed People
Registering your buiness with HMRC
If you have just started in business as a sole trader, and have not registered with HMRC, you can download form CWF1 from this link:
When do I need to file Accounts?
If you have not registered as a Limited Company, you are regarded as Self-Employed by HMRC.
For example, if you chose your year end to be 30th September (and it is your choice) then the 30th September 2011 falls in the tax year 2011/12, because it is between 6th April 2011 and 5th April 2012. Therefore, in this example, your Accounts to your year end 30th September 2011 must be filed online by 31st January 2013 - quite a long time later.
By 31st January 2013, your Accounts will be useful for HMRC, but little use to you because it relates to 20 months ago! This is why it's not a good idea to put it off, because your financial results are important for you to understand.
When do I need to pay my Income Tax under Self Assessment?
Once a business is into its second year, payments on account are collected in the January (of the 6th April to following 5th April tax year) and then the following July.
Just Started ?
For new businesses, the HMRC use "Opening Year Rules" to calculate the tax due. These can be quite complicated, depending on how long a period is covered by your first set of Accounts. If your first Accounts period is 12 months, then you have a nice and neat "basis period", which will make the calculations easier. If your first Accounts period is not 12 months, then it is a little more complicated!
We can save you the time and the hassle.
We will prepare your Income or Corporation Tax calculations and submit them to HMRC.