Clarion Futures Self Assessment Guide for HMRC

www.gov.uk/guidance/tax-free-allowances-on-property and-trading-income Keeping records for HMRC You need to keep records of your sales and expenses for HMRC purposes. You need to keep these records for 5 years after the tax deadline of the 31st January for the relevant tax year. This can include bank statements, receipts, invoices or till rolls, both digital and printed documents. You will also need to decide the accounting method you are going to use. Most small businesses use the cash basis. That is, recording income and expenses as it enters and leaves your account from which you can calculate your profit and taxes for the tax period. www.gov.uk/keeping-your-pay-tax-records

Simplified Business Expenses HMRC allows you to standardise certain expenses to make your return easier. So rather than keep receipts for your fuel that were explicitly used for your business you can use a mileage allowance. Rather than work out your exact room size in your home and the associated energy costs, you can use the flat rate for working from home. https://www.gov.uk/simpler-income-tax-simplified-expenses Self Employed Trading Allowance The trading allowance is a tax exemption for anyone who has a small trading business that generates less than £1000 of gross sales. This could be casual services such as babysitting, gardening, hiring equipment or occasional decorating etc. You don’t need to register with HMRC or complete a self assessment. If you trading sales are over this amount, you will have to register but could claim the trading allowance relief. For example, if you had sales of £2600 with expenses of £400 you would have £2200 profit that would be taxable. By claiming the trading allowance relief. You would only pay tax on £1600 (£2600 - £1000 = £1600).