Tax returns for a small business

Kerriebaby

how do I work out how much tax I need to pay..I run a very small ( and very poor ) dog walking business in Kent, bit worried about the whole tax return thing

fengirl_2

You keep records of all your trading income and all your trading expenses. At the end of the year, you add up all your takings and that is the turnover. You add up all your expenses under general headings such as premises costs, travel, flea powder, etc and add the sum of all these headings together. That gives you your expenditure. Take the expenditure from the turnover and you have your profit.
Then deduct your personal allowance (£6035 this year) and the rest is taxed at 20%.
The key to all this is keeping bomb-proof records as you go along - its really hard to produce an income and expenditure statement for a year from memory!

cosyc

I can recommemend a course run by HMRC aimed at new small businesses and all free of charge.
www.hmrc.gov.uk/bst
they tell you what records you need to keep, when you will get your first bill and how much to put away each week to cover it.