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!