If you’re self-employed or freelance, having to work out your own taxes can be a tedious job. Fortunately, there are many ways to take away this stress. Take the hard work out of your taxes by employing some of these methods.
Keep a record of receipts
Bank statements may be all you need, but sometimes it may be handy to keep on to some of those receipts for further proving your expenses. Receipts are especially important if you’ve paid for something with cash – if you’ve bought some ink cartridges with cash, you won’t be able to take these off your tax if you haven’t kept a receipt. Meanwhile, it may be useful keeping receipts for other expenses made by card too. Say you’ve bought fuel for your company car at a petrol station but also bought some snacks – your statement will lump it all under one sum, whilst a receipt will divide up the expenses, making it easier to prove your claim if an inspector comes round to check your books.
Hire an accountant
Sometimes, paying someone to keep your books in order can be worthwhile – it may free up more time in your week to focus on actual work. There’s no shortage of accountants out there. Just make sure you check their track record to ensure they’re right for you and your line of business. Chartered accountants are generally more trustworthy, although could cost a little extra. Alternatively, you may be able to find a friend or family that works in finance and can sort out your books for free.
Speed up with software
If you’re still slaving over an excel spreadsheet, or worse using pen and paper, it may be time to modernise your methods by buying specialist accounting software such as Quickbooks. This software can automatically calculate expenses and taxes, supplying it all in clear detail. Many accounting programmes are also available as apps so that you can do your book-keeping on the go. If you need to record a quick expense whilst out of the office, this could be very handy.
Know your legal rights
Miscalculations will be made – as long as these are genuine mistakes, you should be able to hire a lawyer. There may also be times when unnecessarily fined for a mistake on their part. You can find the most qualified attorneys for your tax resolution by looking online. Solicitors will charge for their services, but it could be a lot less costly than the fine you’re being given.
Various books and online sources can help you to better understand the legalities of what you can and can’t claim through expenses. Keep on top of changing laws and don’t take risks if you’re not entirely sure of the legality. Claiming a few drinks after work to be ‘client entertainment’ expenses could get you into a lot of trouble if an inspector chooses to look into it further.