Business Tax for Sole Traders/Partnerships
Every Business needs to calculate its annual charge to tax.
We do this on your behalf and advise you of the amounts to pay and the due dates.
We also file that annual forms with HM Revenue & Customs on your behalf.
Business tax can be split into two distinct areas, those of compliance and planning. This page deals with the compliance parts of the work for those who are not incorporated as a Company.
If you trade as an individual then you are classed for tax purposes as a sole trader. This means that you have to prepare a set of accounts for your business each year to include on your self assessment tax return. The details relating to this are set out on our Annual Accounts service page.
Having finalised the accounts a business tax computation needs to be prepared and this provides the figures for the self assessment tax return. As a leading firm of Chartered Accountants in Essex we are experienced in preparing these computations and our accounts manager's and tax department can provide this service to you. As part of the Annual Accounts meeting we would discuss a draft income tax computation to tell you what the liabilities are for Income Tax and Class VI National Insurance, their due dates and the interaction with already established payments on account.
After finalising the accounts we would reduce payments on account if the liability was going to be lower and we always advise you of the liabilities and due dates in writing when sending you your draft self assessment form.
If you trade with others in your own names or a business name then for tax purposes you are taxed as a Partnership. This means that each year you have to prepare a set of accounts for your business to include upon a partnership self assessment tax return which then provides your share of the partnership profits for inclusion upon your personal self assessment tax return form.
As a leading firm of Chartered Accountants in Essex we have prepared many partnership returns over the years and have experience of many complicated profit sharing arrangements and how these affect individual tax liabilities.
As part of the annual accounts meeting we would provide each partner with their share of profit and the tax thereon and notify them of the due payment dates and the liabilities implications in terms of payments on account.
Being in Partnership offers one major downside in terms of penalties. The Partnership self assessment form has its own late filing penalty plus £100 for each partner. This can make a failure to file by the deadline extremely expensive.
Our tax team have statistics generated from our tax software that indicates the progress of every return so that we can make sure that your partnership return can be filed on time. We do expect cooperation in terms of providing the information to enable us to prepare the accounts and returns for you and have a chasing system that is set up to make you aware of your responsibilities should you not meet certain dates.
Registering a New Business
If you fail to make HM Revenue & Customs aware of your business within three months of commencing to trade you will be fined for failing to notify charge ability. We are experienced in making sure that you have provided HM Revenue & Customs with sufficient income to allow them to open a file for your business and obtain your previous tax papers. As part of this process we will also ensure that you are registered for Class II National insurance and have considered a deferment if income from the business will be small.
If you require further advice on any of the above areas please contact Chris Harman on 01376 326266 in the first instance or complete the form below so that we may contact you.