Also, they give businesses a lot of help by helping them make the most money, lose the least, manage their assets, and fill out their tax returns. Accounting books are essential for individuals and corporations who want to understand how their finances function and how to make the most of their money.īy reading accounting books and understanding what they say, people can learn more about money, improve their financial literacy, and improve their financial futures. Saving 25-30% of all income you receive is likely to mean you'll easily be able to pay your tax bill.With the right books, individuals and businesses can gain the knowledge and skills necessary to make sound financial decisions. Open a deposit or business savings account and put money aside for your tax. Make sure you budget for this as you go, so you won't get any great shocks at the end of the year. Obviously, you'll have to pay some to the taxman. Budget for taxĪlthough you may have made a profit (income minus costs), not all of this money is yours. ![]() ![]() HMRC also provides a free payroll solution, which has everything you need to meet your employer-filing responsibilities. Get bookkeeping adviceĬonsider free HMRC videos and webinars These cover getting started, record-keeping, business expenses and more. Whilst there is no exhaustive list available of what you can claim, common sense should prevail when applying the 'wholly and exclusively' rule. If you use your home as an office, you can claim for a proportion of your domestic bills - including lighting, heating, internet and telephone charges, even a percentage of your rent or proportion of your mortgage interest (although this can lead to you having to pay Capital Gains Tax if you sell your property). ![]() The allowed rate for cycling is 20p per mile - so get on your bike instead of using your car. In fact, you can claim for cycling to the post office. Record all your business trips and claim for these - even trip to the local post office in your car to send a business letter or parcel. Consider using Pleo, to simplify and manage your business spending. Remember to keep all receipts for your business purchases - even the smallest costs, such as stamps, stationery, bus and train tickets etc. The general rule is, you can claim for any cost incurred 'wholly and exclusively for business'. You may find that some accountants offer a free, ready-made spreadsheet. You will be surprised how much you can save on fees if you use one your accountant is familiar with or recommends. If you intend to use an accountant, agree the system with them before you start your business. Some business bank account providers offer account holders free accounting tools that can help manage business finances. You could start with a manual system, but it's wiser to at least use a spreadsheet or easy accounting system. This doesn't have to be a sophisticated software package. Set up an accounting system from the start. Late payments and returns can incur heavy fines and penalties. Start recording everything from day one, keep up to date and make sure you know the dates your accounts, tax, VAT, PAYE, etc are due. These can still be deducted from your profits, which will reduce your tax liability. In fact, you may incur costs before you start up. Keep receipts for any stock and supplies you have to buy. ![]() Elaine Clark of .uk gives her top five tips on bookkeeping Keep self employed books from the startĪs soon as you set up your business, start recording all your costs and sales you make. However, doing accounts is an essential part of being self-employed and running your business. Maintaining your own financial records - AKA doing your books - can seem daunting when you're new to it.
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