Do you love the tax man? Rather a silly question really. This most hated figure in the modern world, the object of fear and derision, this night gaunt ghoul who inhabits the nightmares of us all. This person’s only purpose in life is focused in sucking you dry of every penny you earn, can actually be your best friend. Oh yeah! Yeah! How is it possible that this modern day fiscal vampire can be tolerated and even liked? Read on. Well, it’s very simple, Her Majesty’s Revenue and Customs are there to help you. Put quite simply for everything that you want to know about taxation and tax allowances the tax office have a leaflet. I first learnt this by reading Duncan Bannatyne’s (he of Dragons Den fame) autobiography. When setting up his own businesses Duncan always the canny Scotsman found that he could save a fortune on “professional fees” simply be reading the free literature available from the Inland Revenue.
There is a leaflet for everything that allows you to pay only the tax that you legally owe. This should be of note to every eBayer and Amazonian (have I just coined a phrase here!!) who are buying products for resale. You are required by law to register this with Her Majesties Revenue and Customs within 3 month of starting trading. There is a fine of £100 for not declaring this within the 3 month period. Tell them before they find you out as the penalties are rather more severe! Registering can sound rather scary, complicated and nerve racking, just thinking of all those ghouls waiting to pounce and rob you of every cent, penny of other item of small change you may have. The forms are very simple to complete, they are available via the internet, e-mail or by making a simple phone call. Information available at www.hmrc.gov.uk
Once completed you will receive an information pack called “Working for Yourself The Guide” with advice on how to best run your business, details on running your business on a tax efficient basis, how to claim tax allowances and obtaining further information on growth. It is also worth buying a book on how to setup a business; I have found “Starting a Business for Dummies to be very good”.
After April 5th comes the dreaded tax form, in the past a source of endless anxieties and sleepless nights. Although it is a substantial document only part of it will be relevant to your business. The tax form comes with a substantial and informative document to help you fill it in and claim all the allowances you are entitled to. You could get an accountant to fill this in for you but at the early stages of running a business it is fairly straight forward.
You can also file your tax form online which is the preferred method by the HMR&C, who are pushing this very hard at the moment, you also get an additional 3 months before you need to file your tax return. This means that you can hold on to your hard earned for longer and take advantage of the generous 0.01% interest rates available at the bank! One word of warning don’t, repeat don’t, try to con the tax man, (they may be a bit more cuddly than in years past) it will not work they have hundred of years of practice over you and you will lose.
Beware the smiling assassin!
Just stopped by to wish you all the best on the course.
Nice blog. I’ll be back soon
John Edwards says
Glad to see a post covering this subject because while doin masterclass lately i `ve been thinking yipes where do i start with the taxman will i be able to keep my records up to scratch , what details exactly do i keep , how do i afford a an accountant at the beginning ….etc ?
Thanks for that great post !
If this is a duplicate comment, please forgive me as when I hit the submit, I lost connection to your blog and am not sure if it was completed.
I chuckled to myself while reading this because the US “Tax Man” (Uncle Sam) is not very cuddly either.
Being a Baby Boomer myself, I also liked the Credit Crunch series.
Good luck with Masterclasss, your blog is looking good.
Mandy Allen says
A very useful post as you are absolutely right, there are many things you can claim for. I am currently undergoing a tax investigation, which is the downside of all of this. He can walk in at any time and inspect you so always keep receipts for everything and seek professional advice about what and when to claim against tax. It saves you getting caught out if he does come to inspect. It is a long drawn out process and he is looking for any little discrepancy he can find so he can fine you!
Enjoy the journey.
Very interesting post on the tax, a bit scary as well by the way. All this stuff about taxes are complicated. I prefer get help from a professional to deal with it properly. Because we haaaaaave to deal with the Taxes properly!
Keep bringing us good info
John Edwards says
You are so right , about this tax issue and besides who wants to rob the tax man when the benefits are quite good , lets not bite the hand of the perks provider ?
Great post robert TTFN….Ed.