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What do I need for my end of year accounts?

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What do I need for my end of year accounts?

As the 2024 tax year draws to a close, it’s time for the self-employed to turn their attention to their end-of-year accounts. Proper preparation can help you avoid last-minute stress, ensure compliance with HMRC regulations, and even uncover potential tax savings…..always good!

Here’s a guide to what you need to do to get your accounts in order.

 

1. Know Your Deadlines

The UK tax year runs from 6 April to 5 April, and self-assessment tax returns are due by:

  • 31 October (paper returns)
  • 31 January (online returns)
  • 31 January (tax payment deadline)

Missing these deadlines can result in penalties, so mark your calendar and prepare early.

 

2. Gather Your Financial Records

To complete your accounts and tax return accurately, you’ll need:

    • Income records – invoices, sales receipts, and bank statements.

    • Expense records – receipts for business-related purchases, rent, utilities, and insurance.

    • Mileage logs – if you use a vehicle for business.

    • Bank statements – to cross-check income and expenses.

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3. Ensure Accurate Bookkeeping

If you’ve kept up with your bookkeeping throughout the year, this step should be straightforward. If not, now is the time to reconcile your accounts and ensure everything is accurate. Using accounting software like Xero can streamline this process.

 

4. Claim Allowable Expenses

Reducing your tax bill legally is possible by claiming all allowable expenses, such as:

    • Office costs (rent, phone bills, internet)
    • Equipment and supplies
    • Travel and mileage
    • Professional fees (accountants, business insurance)
    • Marketing and advertising

5. Consider Capital Allowances

If you’ve purchased significant business assets (e.g., equipment, vehicles), you may be able to claim capital allowances, which reduce your taxable profit.

 

6. Review Your Tax Liability

Estimate your tax bill in advance so you’re not caught off guard. If you’ve made payments on account, check if they cover your tax liability or if you need to make additional payments.

 

7. Plan for the Next Tax Year

Once your accounts are in order, take the opportunity to plan ahead. Consider:

    • Setting aside money for next year’s tax bill – opening a dedicated savings account can help.

    • Reviewing your business structure – if your profits are increasing, it might be time to consider forming a limited company.

    • Making pension contributions – this can be tax-efficient and beneficial for your future.

8. Seek Professional Advice

Getting your end-of-year accounts right is crucial for financial stability and compliance. By staying organised and planning ahead, you can make the process much smoother and even identify opportunities to save money.

And that’s what we do best…… Satori Accounting in Derry is here to support you. Contact us today to ensure your finances are in top shape for the new tax year! 

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