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I went on a workshop for Ex Forces today, I have found out that from 2020 you will have to use accounting software for tax ie quick books or something and accounts will have to be uploaded every 3 months and not once a year as now

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4 minutes ago, Southpole said:

I went on a workshop for Ex Forces today, I have found out that from 2020 you will have to use accounting software for tax ie quick books or something and accounts will have to be uploaded every 3 months and not once a year as now

 

You will certainly have to upload a quarterly return but I think how you do it will be up to you, as with a vat return. Proprietary software might make it a lot easier though. I am trying to decide whether to try and ramp up my income to make the effort worthwhile or just retire completely and do my own thing.

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11 minutes ago, Martin P Wilson said:

 

You will certainly have to upload a quarterly return but I think how you do it will be up to you, as with a vat return. Proprietary software might make it a lot easier though. I am trying to decide whether to try and ramp up my income to make the effort worthwhile or just retire completely and do my own thing.

 

Sounds like a bureaucratic nightmare that will just increase admin overheads. I hope sole traders with turnovers below a certain threshold will be exempt and/or HMRC will provide the necessary software free of charge.

 

Mark

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At the moment it seems it only refers to companies with turnover of £85k. They'll not extend it to incomes below that until the system has proven itself to work with April 2020 being set as the earliest point it would be introduced. 

 

Looking at the software requirements, it seems like a good money generation scheme for accountants / software developers to charge clients regular fees for something they would otherwise be perfectly capable of managing themselves. 

 

"The government will not widen the scope of Making Tax Digital beyond VAT before the system has been shown to work, and not before April 2020 at the earliest. This will ensure that there is time to test the system fully and for digital record keeping to become more widespread. The changes mean that the smallest businesses and landlords will be able to move to keeping digital records for tax at a pace that is right for them."

 

https://www.gov.uk/government/publications/making-tax-digital-changing-the-scope-and-pace-technical-note/making-tax-digital-for-business

 

 

Edited by Duncan_Andison

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1 hour ago, M.Chapman said:

 

Sounds like a bureaucratic nightmare that will just increase admin overheads. I hope sole traders with turnovers below a certain threshold will be exempt and/or HMRC will provide the necessary software free of charge.

 

Mark

 

One would hope so, but HMRC rules prevent them from 'endorsing' any one supplier over another.  There's a list on Gov.uk here, most of which charge £5 - £10 per month for a basic service, though SimpleTax offer plans from £15 - £36 per tax year, which doesn't seem too bad at all.  I have always used my own spreadsheets, but probably best to begin investigations into appropriate and affordable software OR - should licensing fees continue to fall - bow out completely. :huh:

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Yup, sounds as though it could be too expensive and bothersome to be worth the effort. Shame when we think of all the images we already have up.

Let's hope they have some consideration for very small self-employed businesses - but I'm not holding my breath.

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I was doing a bit of research recently on the tax implications of supplying Alamy and it would appear everyone is allowed to make £1000 p/a from any small hobby earnings before the tax man has any interest at all which I am sure will cover a lot of us!

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17 hours ago, losdemas said:

 

 

One would hope so, but HMRC rules prevent them from 'endorsing' any one supplier over another.  There's a list on Gov.uk here, most of which charge £5 - £10 per month for a basic service, though SimpleTax offer plans from £15 - £36 per tax year, which doesn't seem too bad at all.  I have always used my own spreadsheets, but probably best to begin investigations into appropriate and affordable software OR - should licensing fees continue to fall - bow out completely. :huh:

I've seen a few that are £24 per annual submission. I don't mind that, tax deductible of course. That said, we have a min of two years and during that time I'd imagine there will be a load more software options appearing.... after they've Beta tested it on people with £85k+  :D

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41 minutes ago, Duncan_Andison said:

I've seen a few that are £24 per annual submission. I don't mind that, tax deductible of course. That said, we have a min of two years and during that time I'd imagine there will be a load more software options appearing.... after they've Beta tested it on people with £85k+  :D

 

So the yearly cost will go down as they are entering a market similar to stock photography.:)

 

Allan

 

 

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4 hours ago, Nick Hatton said:

I was doing a bit of research recently on the tax implications of supplying Alamy and it would appear everyone is allowed to make £1000 p/a from any small hobby earnings before the tax man has any interest at all which I am sure will cover a lot of us!

 

However, I think there maybe financial advantages in becoming a sole trader and paying a little tax and NI as it appears to be a cost effective way of increasing state pension entitlement (so far as I can see from changes in my state pension forecast for each year I've been a sole trader).

 

Mark

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46 minutes ago, M.Chapman said:

 

However, I think there maybe financial advantages in becoming a sole trader and paying a little tax and NI as it appears to be a cost effective way of increasing state pension entitlement (so far as I can see from changes in my state pension forecast for each year I've been a sole trader).

 

Mark

Thanks Mark, I have a couple of years to go until my retirement but anything I could to boost my state pension would be a help, I don't really understand this sole trader thing!

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Apparently Nat west Bank has already announced they will provide free software and its expected other banks  will follow suit.

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2 hours ago, Nick Hatton said:

Thanks Mark, I have a couple of years to go until my retirement but anything I could to boost my state pension would be a help, I don't really understand this sole trader thing!

 

Once you are of retirement age you are exempt from NI at least, even if in work. As pointed out you will also have an allowance of up to £1000 before having to pay additional tax.

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36 minutes ago, BobD said:

 

Once you are of retirement age you are exempt from NI at least, even if in work. As pointed out you will also have an allowance of up to £1000 before having to pay additional tax.

That is only once you have reached STATE pension retirement age, not a company pension age. For thousands of women, this means we have to wait longer than we expected.

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10 hours ago, Southpole said:

Apparently Nat west Bank has already announced they will provide free software and its expected other banks  will follow suit.

 

Sounds promising. I'm with NatWest and their banking app is really good so hopefully they do just as a good a job with the Tax/Accounts app!

 

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10 hours ago, Sally said:

That is only once you have reached STATE pension retirement age, not a company pension age. For thousands of women, this means we have to wait longer than we expected.

 

UK State pension forecast can be obtained for free from here (the official UK government website) https://www.tax.service.gov.uk/check-your-state-pension 

You will need to prove your identity by answering some questions. It took about 30mins to get a detailed forecast including a record of my NI contributions to date.

It was useful as I thought I already had the 35 years I needed to reach the max entitlement. But it looks like I don't because I was contracted out whilst paying into my company pension. Hence the desire to get some more years of NI contribution now.

 

Mark  

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13 hours ago, BobD said:

 

Once you are of retirement age you are exempt from NI at least, even if in work. As pointed out you will also have an allowance of up to £1000 before having to pay additional tax.

 

12 hours ago, Sally said:

That is only once you have reached STATE pension retirement age, not a company pension age. For thousands of women, this means we have to wait longer than we expected.

 

I assumed rightly or wrongly that was what Nick meant, unfortunately I have no control over the state retirement age for either men or women.

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10 minutes ago, BobD said:

 

 

I assumed rightly or wrongly that was what Nick meant, unfortunately I have no control over the state retirement age for either men or women.

Of course not, just me having a rant, sorry.

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Without having read the info, I'm assuming that if we already use an accountant, we can carry on as usual, but we'll have to do it quarterly? For sure, I'd keep an eye on what that would do to my accountant's bill, which is currently IMO reasonable enough for the peace of mind (I have a tendency towards dyscalculia) - there is going to be a point when expenses makes this pointless, even if I'm only keeping files online. Although with falling prices, that might coincide with me netting <£1000 pa (currently more than that from micro, less than that from Alamy, plus dribs and drabs from DACS and FAA).

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