Six self-assessment tips for sole traders
Self-assessment can be a challenging task for sole traders; however, with the right approach, it becomes far more manageable. Here are six tips to help you complete your tax return efficiently and accurately.
1. Gather your information early
Preparation is key. Collect all necessary documents, including your unique taxpayer reference, national insurance number, records of income and expenses, and any contributions eligible for tax relief. Keeping organised records throughout the year will save time when filing your return.
2. Complete it in one session
Set aside uninterrupted time to complete your tax return in a single sitting. This method is often quicker and reduces the chance of missing key information. Taking breaks or tackling it in segments can make the process longer and increase the likelihood of errors.
3. Use software to simplify filing
While HMRC’s online platform is free, using third-party software can streamline the filing process. Such tools guide you through the forms, highlight mistakes, and prompt you for missing information. Although it involves a small cost, it can save time and provide peace of mind, particularly for those less familiar with tax forms.
4. Pick the right time and environment
Choose a quiet, distraction-free space to work on your self-assessment. Inform anyone nearby that you need uninterrupted time, turn off notifications, and stay focused. Tackling your tax return early in the year also reduces stress and avoids the last-minute rush as the 31 January deadline approaches.
5. Don’t forget pension contributions
Pension contributions can lower your taxable income, offering tax relief while helping to secure your financial future. Make sure you include these in your calculations to maximise your benefits.
6. Seek professional help if needed
If self-assessment feels overwhelming, consider hiring a local accountant to prepare or review your tax return; for example, accountants Bath such as Chippendale and Clark offer expertise that can save time and ensure accuracy. For straightforward returns, the cost is often outweighed by the peace of mind and potential tax savings.
By following these tips, sole traders can approach self-assessment with greater confidence and efficiency.
