Less than 60 days to go until the self assessment tax return deadline
Less than 60 days to go until the self assessment tax return deadline
With less than 60 days to go until the self assessment tax return deadline, a recent survey has recognised that around 75% of the self employed do not know when higher rate tax starts.
The survey found that 75% of the self employed are unsure of the current tax thresholds that cover their earnings. Only 10% were aware of the HMRC penalty scheme for late filing of tax returns and non-payment of tax and half of those surveyed thought there would be no consequences at all.
Although the number of people who were self employed fell dramatically during the pandemic, the sector has since recovered and is moving back towards similar numbers to those seen prior to 2020.
Many self employed find a lot of the ‘rules’ difficult to understand, such as when VAT registration should be applied for and when HMRC returns are required for the various services, with nearly 60% advising that they had not set aside the money to pay any up and coming tax bills.
Most self employed also admitted that they tended to do their tax returns themselves rather than use an accountant, therefore they are missing out on tax advice and potential savings.
17% of the self employed were concerned about the impact of Making Tax Digital, especially because from 2026, sole traders and buy to let landlords will have to report earnings on a quarterly basis along with a yearly report of total earnings.
If you are self employed and also finding that you are scraping together money to pay the amount owed rather than being prepared and having it ready and set aside, or that you don’t have the funds available or the correct advice as to whether your business should be a limited company or remain as a sole trader or VAT registered for instance and you are struggling to meet and remember deadlines – then come and talk to us at Kennedys Accounting.
We can talk you through the right way to trade for you and your circumstances and also support you on your growth journey.