How can I reduce my tax liability?

Reducing your tax liability usually comes down to good planning, making sure you’re claiming all allowable expenses and using any available allowances or reliefs. The best approach depends on your circumstances, so it’s something we can review with you to ensure you’re paying the right amount of tax.

What’s the difference between a sole trader and a limited company?
A sole trader and the business are legally the same. A limited company is a separate legal entity, which can offer liability protection and different tax treatment.

Do I need an accountant?
Not legally, but an accountant can save you time and stress. They make sure your accounts are correct, deadlines are met, and you claim everything you’re entitled to.

When do I have to register for VAT?
You must register for VAT once your VAT taxable turnover exceeds £90,000 in a 12-month rolling period (current UK threshold). You can also register voluntarily before reaching this if it benefits your business.

Do I need to register as self-employed?
If you earn more than £1,000 from self-employment in a tax year, you usually need to register with HMRC and complete a Self-Assessment tax return.

Do I need separate bank account for my business as a sole trader?
Sole traders aren’t legally required to have one, but it’s highly recommended. Keeping business and personal finances separate makes bookkeeping and tax much simpler.

How long should I keep accounting records?
In the UK, most businesses should keep records for at least 6 years in case HMRC needs to review them.

What’s the difference between turnover and profit?
Turnover is the total money your business brings in. Profit is what’s left after you subtract expenses like costs, wages, and overheads.

If you’ve ever Googled any of these, you’re definitely not alone. Please feel welcome to contact us if you have any unanswered questions we can help with.