Information provided by Kidwells Accountancy on our website is for informational purposes only. For bespoke advice, call 01432 278 179 or email info@kidwellsaccountancy.co.uk to learn more about what is best for your business.
What is a self-Assessment?
Self-Assessment is a method HMRC uses to collect Income usually deducted automatically from wages. People with other income must report it in a tax return.
If you are employed, tax is deducted from your wages. As soon as you start earning money above this you are required to report your income to HMRC so the correct tax is paid.
The way you report your income to HMRC is through a self-assessment tax return. As an individual, you can submit your self-assessment tax return yourself. Sometimes though it can be unclear what you can class as income and expenses. How much tax you will need to pay to HMRC will be solely dependent upon what income tax band you are.
If you need to submit a self-assessment tax return, the financial year will be from the 6th of April covering 12 months. At the end of the tax year, you will need to submit your self-assessment tax return and pay your income tax, national insurance. and capital gains tax by the following 31st of January. If your payment is late, you will receive a penalty, so it is important to have instructed an accountant in time to submit on your behalf.
All tax returns must be honest and accurate. Failure to complete a tax return can not only result in penalties from HMRC but can also lead to legal proceedings.
2020-21 Tax Bands
Basic information:
|
|---|
| Either keep all receipts and bank statements or Submit to an accounting tool, e.g., Xero |
| Earnings | Tax | National Insurance |
|---|---|---|
| Less than £6,475 | £0 | £0 |
| £6,475 - £9,500 | £0 | £3.05 per week |
| £9,501 - £12,500 | £0 | 9% on profits + £3.05 per week |
| £12,501 - £50,000 | 20% | 9% on profits + £3.05 per week |
| £50,001 to £150,000 | 40% | 2% on profits + £3.05 per week |
| Over £150,000 | 45% | 2% on profits + £3.05 per week |
How we can assist you?
We understand that sometimes the day-to-day running of your business can take over. A tax return may be something put to the back of your mind. As a firm, we can assist you through all your tax needs. There are different ways of working with us. As an example, you could send all your bank statements and receipts for the relevant tax period and we will do the rest. Allowing you to focus on the management of your business. We will calculate the tax you need to pay and submit the self-assessment on your behalf.
As a team, we can also offer other support where you can keep track of your income and expenses yourself through an app. We recommend Xero and can support you in setting this up.
You can easily submit your income and expenditure through the app producing a report. You can forward this report to us to complete your self-assessment on your behalf.
We assure you that we work hard to give you the best tax position possible while being legally compliant.
It’s not always the local accountant, the cheapest, or the one with the most reviews that’s best. It’s about what works for you.
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Disclaimer: Information provided by Kidwells Accountancy on our website is for informational purposes only. It is provided in good faith but we make no guarantee of any kind regarding the accuracy, reliability, or completeness of any information on our site. We always recommend businesses seek independent legal and financial advice before working with us or acting on any information on our website.