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Working through a limited company or as a sole trader? These are the deadlines that you NEED to know about

By PaperRocket Accounting, Sep 6 2019 12:31PM

When you’re running your own business, you want your priority to be providing your service and giving your clients a great service. What you don’t want is to be spending time trying to figure out what accounting submissions are due when, or rushing at the last minute to get things filed in time.


Well, never fear, PaperRocket have you covered! Here we take a look at the main tax deadlines that you need to be aware of, whether you are running your own limited company or working as a sole trader.



VAT


Applicable to Limited Companies or Sole Traders?

Applicable to both limited companies and sole traders IF VAT registered.


What is it?

If you are VAT registered, you will need to add 20% VAT onto all vatable invoices. This needs to be collected and paid over to HMRC, less any VAT that you have incurred on business expenses.


How often is it calculated?

Quarterly. When you register for VAT you will be told which quarters you will need to submit returns for. Each quarter, you will need to calculate the amount of VAT you have charged on invoices for that quarter, less the VAT on any allowable expenses for that quarter.


When is the deadline?

1 month and 1 week after your VAT quarter end date.



PAYE, Class 1 NI and Employers NI


Applicable to Limited Companies or Sole Traders?

Applicable to both limited companies and sole traders employing employees and with a PAYE scheme.


What is it?

If you have employees that you are paying a salary that attracts tax and/or national insurance, you will need to deduct any tax/employees national insurance at source on behalf of your employee, and pay that over to HMRC together with any employers NI that may be due.


How often is it calculated?

Every time you pay a salary, the tax/ni on it will need to be calculated. Most salaries are paid monthly, so this will usually be calculated each month. However, if the total amount of tax/ni due to HMRC is less than £1,500 per month, then you only need to pay this over quarterly (if more than £1,500, it will need to be paid monthly).


When is the deadline?

If paying electronically, the 22nd of the month following the end of relevant quarter, or month if paying monthly (the 19th if paying by cheque).



Class 2 & Class 4 NI


Applicable to Limited Companies or Sole Traders?

Just sole traders.


What is it?

If you are self-employed, you will have to pay 2 different types of National Insurance based on your company profits:


• Class 2 if your profits are £6,365 (19/20) or more a year. This is at a rate of £3/week.

• Class 4 if your profits are £8,632 (19/20) or more a year. This is calculated as 9% on profits between £8,632 and £50,000, and then 2% on profits over £50,000.


How often is it calculated?

This will be calculated as part of your self-assessment return for the year.


When is the deadline?

See self-assessment deadline below.



Corporation tax


Applicable to Limited Companies or Sole Traders?

Only applicable to limited companies.


What is it?

Your company corporation tax is calculated as (currently) 19% of your annual company profit. This is the company income less any allowable expenses.


How often is it calculated?

Annually. Each year, you are required to prepare company accounts and corporation tax return(s) to declare your company profits for that company year. It is when these accounts/returns are prepared that you will be in a position to calculate your company corporation tax liability for the year. Generally (unless you change it), your company year end date will be the end of the month in which you incorporated your company (so, if you set up your company on 6th March, your year end date going forwards will be 31st March).


When is the deadline?

9 months and 1 day after your company year end date.



Self-Assessment


Applicable to Limited Companies or Sole Traders?

Both.


What is it?

If you are a limited company director, working as a sole trader or if you have any income that is not taxed at source, then you are required to complete a self-assessment tax return to HMRC, declaring all income for the personal tax year.


How often is it calculated?

Annually. For any year that you are a company director, working as a sole trader or receiving untaxed income, you must complete a self assessment tax return. The personal tax year runs from 6th April to the 5th April, and this is the same for everyone, unlike company accounting years.


When is the deadline?

31st January of the following year. This is the deadline for the return and any balancing tax liabilities. However, in certain situations, you may have to make payments on account which are due twice a year, by 31st July and 31st January.



P11d


Applicable to Limited Companies or Sole Traders?

Potentially both. Limited companies if there is a PAYE scheme and sole traders if there is a PAYE scheme and employees (best to check with your accountant if you will be required to complete one)


What is it?

If you provide ‘benefits in kind’ to your employees, then these will need to be declared on a P11d form and the employee will be required to pay tax on this, with the employer also having to pay additional employers NI.


How often is it calculated?

Annually. Each year a P11d will have to be completed to declare any benefits for the previous tax year.


When is the deadline?

22nd July for any employers NI due (if paying electronically). The P11d itself needs to be filed by 6th July. Any additional tax on benefits payable by the employee will be paid via an adjustment to their tax code.



PaperRocket Accounting provide accounting and tax services to professional contractors and freelancers working in the UK.


We offer our clients a flexible choice of fixed fee monthly packages which cover all of their accounting and tax needs (so no hidden costs or surprise bills!). All of our accounting packages include a monthly subscription for a cloud accounting software subscription provided by the awarding winning FreeAgent.


Each of our clients is given their own dedicated qualified accountant with unlimited access in person, telephone, or by email.


We pride ourselves on our client satisfaction and customer service and were awarded 'Welwyn Hatfield Business of the Year 2019' in the SME Hertfordshire awards. We were also finalists for 'Best Contractor Accountant 2019' in The Contracting Awards, 'Small Practice of the Year 2016' in the AccountingWEB practice excellence awards, as well as FSB Hertfordshire Service Excellence finalists in 2015 and 2016.


To find out how we can help you please get in touch now.


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