Help with Accontant and Tax Return for Sole trader Please

Help with Accontant and Tax Return for Sole...

Didn't find your answer?

I started in February 2013 selling musical instruments online and privately as an Sole trader  , business could be better but it is nice to be your own boss .

The issue is that it is coming up to January and I am getting stressed about my tax return as I have never done it before

My original intention was to submit my own paperwork to the HRMC but I have decided against it as running the business is hard enough and with no experience I am going to struggle.

Have I left it too late to get an accountant ? as I have no idea on when or how to go about filling in the tax return and I am worried that I will fined by the HRMC .

I did inform the HRMC when I started and have been paying my NI contributions.

 I have done my best to keep records of my sales , purchases , expenses and fuel costs if folders etc .

 90% of my sales is done on ebay so I will be able to download any information I need.

Anyway thanks for taking the time to read my post and any help would be much appreciated .

Shahpur ( tonewoodmusic)

Replies (22)

Please login or register to join the discussion.

avatar
By carnmores
28th Dec 2013 10:26

i broadly agree


where an accountant is likely to help most is  in the choice of your year end as the 'correct' year end can considerably reduce your tax now and possibly in the future ; however you may not need an accountant now  for 2012 13 as any figures you submit can be amended at any time in the next 12 months. so for this year if pressed enter your PAYE detail and add estimated detail for self employed income , this can all be changed later when you all havw more time , tho you should try and get the figures as close as poss.

Thanks (0)
avatar
By refs8
28th Dec 2013 20:03

Yes agreed
Yes don't panic, we are receiving similar emails from client referrals at this time of year and there is always a solution I would advise talking to local contacts such as banks, business contacts and see who they can recommend and then speak to a few and see how you get on!
Good luck

Thanks (0)
avatar
By shahpur
28th Dec 2013 20:53

Thanks to you all for taking the time out to answer my questions . I am in the process of getting everything together and inputting  all my data in to an excel file to help  the accountant handle the case easier .

 

If i  am honest i am not 100% sure how the tax year system works .

 

If i started my business in Feb 2013 and have to submit an return from the 5th of April to the 31st Jan am i only taxed for those months for this year ( how do they work out if i will reach the VAT threshold ) ?

 

This is my first year of trading and was unemployed for an 18months before hand before taking the plunge to start up on my own.

Thanks (0)
avatar
By shahpur
28th Dec 2013 20:56

Just to confirm will i only need to submit my Feb 2013 to April the 5th 2013 for this tax year by the 31st of January?

Thanks (0)
By petersaxton
28th Dec 2013 22:01

Excel?

Have you considered the advantages of online bookkeeping? Maybe you should ask the accountants you see what they would recommend?

Thanks (0)
Replying to johndewey:
avatar
By shahpur
29th Dec 2013 16:03

Just filled all my details into an Excel worksheet i brought from ebay , it has calculated that for the 2 months 6500 is turnover but is  says the total profit

- 4000 due to the amount that i have in stock  ?

How does this work in an tax context , am i liable to pay tax on this amount ?

I am using the HRMC SA form which is pretty straight forward as i only have 2 months to complete but will definitely be looking for an accountant in the new year for my yearly report.

 

shahpur

Thanks (0)
By petersaxton
29th Dec 2013 17:11

It depends what you mean

Without knowing what you mean to say it would be impossible to comment.

Thanks (1)
avatar
By shahpur
29th Dec 2013 17:30

Just to clarify i started in February with no stock and used my savings from the 2st of the month to buy the stock .

The total amount turnover ( inclusive of everything  )is around 6000 for the 2 months but i have spent more than this on stock ( around 10000) .So i am left with an minus figure of around 5000 . when i subtract my expenses ( which includes stock ) from the total turnover.

I was just wondering how i carry this over to the next year .
s

Thanks (0)
By petersaxton
29th Dec 2013 18:30

Closing stock

You deduct closing stock from your purchases to arrive at cost of goods sold.

Why don't you ask your accountant about this? It seems strange that you wait until he "goes away" and then you get interested.

Thanks (0)
avatar
By shahpur
29th Dec 2013 19:00

I have not got an accountant at the moment , and have been using the SA form online . I will have to wait till the new year to look for an accountant but i am trying to get all the information together so to cut down the time it will take to submit.

 

Thanks (0)
By petersaxton
29th Dec 2013 19:54

The accountant

will be able to sort it out.

I don't think the fees will be a lot if you have a separate business bank account and have reconciled the bank.

Thanks (0)
avatar
By shahpur
30th Dec 2013 15:53

hi just loaded all the information into my excel soletrader software and come up with

 

Profit & Loss Account                                    
                                    
    Total income                            6,418    
                                    
                        
    Direct costs                                
        Opening stock                                 0                    
        Stock - items for resale                        10,814        
        Postage costs                    641        
        E-bay fees                    576        
        Closing stock                    8,421        
                                Total      20,452   
                                    
    Gross profit                            (14,034)  

 

does this look right ?

Thanks (0)
By petersaxton
30th Dec 2013 16:03

No

Take off closing stock (not add as above) to arrive at direct costs.

You would struggle to make a trading loss of £14k on £6k sales!

 

Thanks (0)
avatar
By shahpur
30th Dec 2013 16:32

is this correct , as i said i am using an excel worksheet which i brought off ebay to help do the maths .

 Total income      6,418                    SA form box # Direct costs          Opening stock         Stock - items for resale    10,814    Postage costs    641    E-bay fees    576    Closing stock    (8,421)          3,61110           Gross profit      2,807 

The total allowable expenses comes to

  £4,269

 

Thanks (0)
By ShirleyM
30th Dec 2013 16:39

You said you were going to get an accountant

They will help you sort out what is allowable, and what isn't. They will also work out the trading, and taxable, profits.

The accountant won't accept your calculations. They will want to do the calc's themselves, and if they have the time they will explain their adjustments to you.

Thanks (0)
By petersaxton
30th Dec 2013 16:52

Direct costs are out by £1 - most likely rounding

My guess is he's not going to use an accountant.

Thanks (0)
avatar
By shahpur
30th Dec 2013 17:41

I fully understand but i am worried about getting my January return in on time for the 2 months in 2013 ( feb and march ).

 

I have been looking for an accountant but most are closed for the new year or not taking any customers on in January so may need to submit the details myself until i find one.

 

I have received PM messages from accountants but non are in my area ( Birmingham ) .

Thanks (0)
By petersaxton
30th Dec 2013 17:56

It doesn't make sense

You don't do anything from 06/04/13 until after Christmas and then you try to contact accountants between Christmas and the New Year. Now you are panicking when there is still a month to go.

I had some water leaking during the recent storms. What did I do? Panic? No, I knew it wouldn't be easy to find somebody between Christmas and the New Year so I made sure no damage was done and then I will look for somebody to deal with it in January.

 

Thanks (0)
avatar
By tonyh
30th Dec 2013 20:37

Another time waster

Not been on this site long but I am driven mad by these type of questions.

The people do not seem to appreciate the great generosity of the people who take the trouble to answer the questions.Many of the contributors are highly qualified professionals who give freely of their skills and professional knowledge to help others starting up or with temporary mind blanks.

Reading through, even from Christmas I can see £1000's of free advice provided.

On this particular thread people have given excellent advice and have been rewarded by a S....

spreadsheet stated to have been  purchased off ebay and then contributors are expected to give further advice.

Thanks (2)
avatar
By Alexdon
31st Dec 2013 10:31

Profit

Assuming the total expenses (£4269) include the costs (£3611) deducted to get to the gross profit -   

enter £6418 in Box 8 and £4269 in Box19 leaving a profit of £2149. These are the only boxes which require entries.

Now go and find an accountant who for a reasonable fee can give you further advice regarding the correct treatment of any fixed assets together with other useful advice such as mileage allowances as oppose to fuel costs.

My fee note is in the post.

Thanks (1)
avatar
By shahpur
31st Dec 2013 18:18

Hi thanks for every ones help .

I was able to source an accountant today who said that they will be able to complete the SA in time for the deadline with the details i provided them.

Sorry for all the posts   but i was worried that i was going to struggle to find an account and had to complete the process myself .

 

Thanks again and happy new year to you all

shahpur

Thanks (1)
By ShirleyM
31st Dec 2013 18:20

Thanks for the update, shahpur

Happy New Year to you, and all.

Thanks (0)