Accounts & Tax Return Help

supermonkey

jexygirl wrote: »

An accountant will save you money... trust me
They are good at what they do, they are trained to do what they do, they know what stuff to put in what boxes!
Also, how many hours have you already spent reading, looking up, trying to fill in forms yourself? All hours you could perhaps spend on building your buisness up?
An accountant would probably have this all sorted for you within an hour or 2 ...

Since I have already put some time in I dont want to give up now. And I really dont see how they could save me any money. How much would they charge - £200... I don't think that'd save me anywhere near that - it's a simple business!

jexygirl

re read all the questions you have asked, re read the varying answers, and go see an accountant.
Most will offer the frist half hour free consultation, and yes, they may charge £200 to put in a proper, knowledgable, full return that wont come back to bite you in the backside, (tho you say its a "simple" buisness) depending on the size of your buisness or whatever. but
They will also know ALOT more than you about what is reasonable, what is possible, what you can claim that you didnt know, what can be put under other headings to maximise profit and a whole host of other things. I would guess you would easily cover the cost of one in what you don't know.
Buisness is NEVER simple.
Alternatively, ask advice on a forum, where people run their own buisnesses in differing ways, will give differing answers, and actually know nothing about your buisness...

supermonkey

jexygirl wrote: »

re read all the questions you have asked, re read the varying answers, and go see an accountant.
Most will offer the frist half hour free consultation, and yes, they may charge £200 to put in a proper, knowledgable, full return that wont come back to bite you in the backside, (tho you say its a "simple" buisness) depending on the size of your buisness or whatever. but
They will also know ALOT more than you about what is reasonable, what is possible, what you can claim that you didnt know, what can be put under other headings to maximise profit and a whole host of other things. I would guess you would easily cover the cost of one in what you don't know.
Buisness is NEVER simple.
Alternatively, ask advice on a forum, where people run their own buisnesses in differing ways, will give differing answers, and actually know nothing about your buisness...

I appreciate your advice, but my aim has always been to keep costs low. For an accountant to save money, there must be a reasonble amount of expenses to begin with so that they can advise the best way to claim them.

grey_lady

A good accountant will save you more than what he/she costs you. But if you'd rather give money to hmrc unnecessarily then carry on doing it yourself.

Personally I think your not looking at the mobile bill in the way that would most benefit you, but an accountant would be the best person to advise.

jexygirl

supermonkey wrote: »

I appreciate your advice, but my aim has always been to keep costs low. For an accountant to save money, there must be a reasonble amount of expenses to begin with so that they can advise the best way to claim them.

you have a buisness, there are expenses. Alot.
There are also profit /loss, outgoings, incomings, expenditure, that you may not even realise you can claim without EXPERT advice.

Saving money isnt what its about, making profit in the right way is, and thats where an accountant comes in. They know what boxes to tick and where to put things, so that you do make money, and in the process save unecessary expenses.

I'm all for doing it yourself to save money, when and where you can and are capable and knowledgable in the area. That's good buisness in some ways. But, when you can potentially lose, because you don't know, then that's not.
Call a few up, ask for a free consultation, even if you don't take them on, you will know more than you do now for the sake of an hour or so.
I've been in buisness for a fair few years now, my accountant has even said to me that i could do some aspects of what he does myself - i chose not to, I dont have time or knowledge, and for what he charges, it saves me stressing over it and i know its done properly by someone who knows. He has also, over the years saved me ALOT of money, more than I have paid him, on things i didn't know i could / would / should claim/ return / have allowances on. Nothing illegal, I simply didn't know, that's why I do my job, and pay someone else to do theirs.
Jex

supermonkey

Fair enough - I will have a think about it.

The reason I state my expenses are minimal and accounts simple is this:
The business does a small number of high value orders rather than lots of small ones. I don't buy anything to sell on. I rarely have to travel, but am fully conversant with the fixed rate mileage anyway. There are no staff. Will claim the £3 a week for premises to avoid cgt. No repairs. No loans. Minimal phone, interent & stationary. Only use free advertising. No debt, subriptions, training. Small allowant of fixed assets.

All incomings & all outgoings are recording in my accounts (including part personal items eg internet). There is simply nothing else I can claim that I am not already!

I also do have a business advisor who has been helpful in these matters and attended HMRC training courses.

I would point out that they specifcally states that "accountants can and do make mistakes". They also stated that if there is an error on the tax return, it is irrelevant whether you used an accountant. No matter what an accountant did (honest mistake or not) it would you who would be liable.

grey_lady wrote: »

Personally I think your not looking at the mobile bill in the way that would most benefit you, but an accountant would be the best person to advise.

Again, I may visit one - but what do you think would be best?

grey_lady

Jexygirl put it quite well but I dont think your taking in what she is saying - you seem to have fixed ideas based upon what people who arent accountants have told you.

HMRC is not your friend, it is not their job to make sure that you are paying the least amount of tax and claiming the correct expenses.
E.G If you would rather pay for your phone out of your net earnings then up to you, but chances are HMRC would be just fine with you paying for it all out of your pre-tax earnings (its to do with how the different packages and free minutes affects things). Depending upon how much your turnover is it might also be worth you becoming vat registered on the flat rate scheme.

But please dont take my word for it - talk to an actual accountant! Half an hours chat wont cost you anything and will probably save you hundreds.

I also think that you might need to be LTD rather than self employed and that you might well need indemnity insurance based upon your previous thread.

Premier_2

Trying to keep costs low is wise, but look at the bigger picture.

Don't think it'll cost me £50 for an accountant to do this when I can do it for nothing, think how long will it to take me to understand this fully, how many hours will it take me to then do it and how much could I earn in all those many hours if I were not wasting it on things I do not understand.

Sometimes it's cheaper to employ a professional even if they do charge £50 an hour. Hopefully you make over £5 per hour, but if you are spending over 10 hours on a problem (as you appear to be doing) that a professional can do in one hour then the cost saving route is to use the services of a professional.

With an accountant, that is even more reason to use one. The problem is not as simple as am I reporting this correctly (which you may achieve if you spend 10 hours on it) but rather, am I reporting this in the most advantagous way for me and my business (which you are unlikely to do unless you spend the years required studying to become a professional accountant)

That is why an accountant should save you money - they should be able to report your financial position in such a way that the additional savings they produce for you more than covers their costs.

As to you being liable for what is on the tax form, that is true, but that doesn't necessarily mean do it yourself.
If you are involved in a complicated legal dispute, it is you that is ultimately responsible, but that doesn't mean you wouldn't seek the help of a lawyer would it? I would hope you would use the services of an independant legal expert, take their advice and where you do not understand, ask them to explain.
Likewise with an accountant. If there is anything an accountant suggests you do, if you don't understand or are in anyway concerned, ask them to explain ... but don't try to be an expert in a field you are not.

Also remember, whilst you are ultimately responsible for what is declared on your tax return, the accountant is a professional and if they give wrong advice, can be liable to you for such.

supermonkey

Thanks for all the replies

I do understand where you are all coming from. And am making an appointment with an accountant, but this would be more beneficial for next year. I do not feel they could save me much over an accounting period of a few months in which I did not earn much at all. I do understand that an accountant might help to claim things in a more advantageous way - but what I'm saying is that this applies more to a business with complex accounts and lots of expense (my expenses including personal are less than 5% of what I have earnt). Mine does not. Will I get a gaurantee that the accountant will save me money? No. Have I currecntly got the time to do it myself? Yes.

Grey Lady -
Phone is used for personal & business. I will use a reasonable % for business of this (applied to the total bill not just calls). I would not want to claim the entire thing as if I weren't self employed, I'd still have the phone and make calls. Also, for a total telephone bill for 12 months of under £200 (and this return being for a few months only), I don't see how that would save me much at all.

I am nowhere near the VAT threshold and would not volunteer for it as its an unnesscary complication.

I have no idea why you think I need to LTD, but again it's an over complication.

Premier -
Yes I do understand that sometimes saving money isn't everything! I have spent no where 10 hours on this - I just check the thread every now and then & reply. I was spending more time on it as I am trying to tackle things for next years return at the same time.

Whilst I appreciate the advice here, I dont understand why 11 out of 20 posts are about the use of accountants. The thread was started with a few simple questions to help my understand and those of others.

Savvy_Sue

supermonkey wrote: »

Premier -
Yes I do understand that sometimes saving money isn't everything! I have spent no where 10 hours on this - I just check the thread every now and then & reply. I was spending more time on it as I am trying to tackle things for next years return at the same time.

Whilst I appreciate the advice here, I dont understand why 11 out of 20 posts are about the use of accountants. The thread was started with a few simple questions to help my understand and those of others.

I do hope you're doing research other than on this thread! And THAT'S why people are suggesting that you use an accountant: they have this knowledge at their fingertips, they know where to look it up if they don't know it.

I'm not an accountant, and I no longer run my own business. Once I'd seen what my accountant was doing with my returns, I felt happy enough to do it myself, but I was glad of the security of having seen him do it a couple of times first. But I really WAS running a VERY simple business!