• Heather Topf

12 ways to make your 2021/22 tax return easier for yourself

Updated: May 23

It's the 6th of April and officially the beginning of the new UK tax year.

Say what you want about the last year (I know I could say plenty about it), but it did if nothing else give me the time and space to finally put together a system to make my own life a little easier when it came to filing my self-assessment.

I'm not an accountant, but I do know how much they hate it when you turn up at the end of January, days before your submission and payment are due, armed with a Tescos bag of crumpled up receipts you spilt coffee on at some point in the last year.

If you're unsure on how to actually file your return, or what is and isn't a deductable item, I'd 100% recommend finding an accountant to give you some advice. They'll usually save you more than you pay them - it's a no brainer.

As with most things, if you do it little and often, it's really not much hassle, so, with no further ado, here are 12 ways to make your 2021/22 tax return easier for yourself. Here we go!

  1. Start a spreadsheet with two tabs, income and outgoings. Every time you have an invoice paid, update the income tab with the date paid, company, type of work and which bank account it was paid into.

  2. Get a container - an envelope, file, plastic wallet, doesn't really matter and make 12 subsections. Label them with the month and put any physical paper receipts in them by month.

  3. Start two files in your email inbox, label them invoices and receipts. Whenever you purchase something for your business online, file the receipt into the recipes folder. Whenever you send an invoice, file it into the invoice folder.

  4. When you get a paper receipt write what you bought and the date on the back. I promise you, you won't remember if you bought a ream of printing paper for the business (deductible) or a load of trashy magazines (totally not deductable in 99.9% of cases) in a years time. If you're on a business trip, write the trip and the client on the back too - lunch isn't usually an allowable expense, but if you've gone away to a conference it might be.

  5. Open a business account.

  6. Open a business savings account.

  7. Get all your invoices paid into your business account.

  8. Work out how much tax and National Insurance you'll need to pay on the money you earn. This calculator from HMRC is brilliant, though sometimes takes a bit of extra maths wizardry when you get paid different amounts each month.

  9. Transfer the money for your tax and NI as soon as you're paid, from your business account to your business savings account. NEVER touch this money, unless you're paying your tax bill.

  10. Have any subscriptions/bills/direct debits that your business needs set up to be debited directly from your business account.

  11. Each month take the amount you've been paid, minus at a very minimum 5% for profit reinvested into the business, minus the total of your monthly bills, minus the tax and NI you'll need to pay and transfer to your personal account. This is your "wage" for your personal outgoings.

  12. Pick a date. Every month on that date, go through your bank statement and make sure all your paid invoices are noted on the income tab of your spreadsheet and all your expenses are on the outgoings tab (added bonus, you're much more likely to notice any unusual activity or payments that need cancelling if you go over your bank statements monthly).

I promise when it comes to getting your accounts together next year you'll thank yourself. Doing it as you go along and reconciling your statements each month means you'll hardly have to think about it, plus it gives you loads of time to fix any error way before your return is actually due.

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