[ftp]

Just come back from a meeting with my accountant who informs me that in January i have to pay my first big tax bill followed by the double whammy of paying another lump at the end of July - luckily i have funds tucked away to cover this. Would be nice not to pay any at all. 

[Dean Taberner]

Its called a payment on account.

It has to be done every july for sole traders.

Enjoy.

[tomy jackson]

o yes

[matt]

Just come back from a meeting with my accountant who informs me that in January i have to pay my first big tax bill followed by the double whammy of paying another lump at the end of July - luckily i have funds tucked away to cover this. Would be nice not to pay any at all. 

the amount you earn , it'll alot of money

[seandyer2003]

Its called a payment on account.

It has to be done every july for sole traders.

Enjoy.

You have to pay every january and july??

[ftp]

Only the first time. Then it's just January.

[Sir Squeaky]

Yeah, the conning gits had me with that one last year.

I tore a few heads off on the phone about that one.

[matt]

Only the first time. Then it's just January.

i pay twice a year

jan and july

[seandyer2003]

so you dont have too after the first year??

[Dean Taberner]

Ive been self employed for 5 years.

First time I paid the tax owed for the year ie £2500 then they wanted 50% of that again on account £1250 so in jan I paid £3750. Then in july I paid the other £1250.

The next year if my tax was say £2500 again for the period they then took my 2 payments of £1250 = £2500 off which left me with £0 to pay but had a payment on account for the next year of £1250 to be paid in that jan and the another £1250 to be paid in july.

And so on......

Very confusing at first but im with it now.

Dean.

[Paul Coleman]

Only the first time. Then it's just January.

i pay twice a year

jan and july

So do I.  I didn't owe anything last January though.  I earned OK but that was when the capital allowances for WFP stuff started kicking in.  I expect a chunkier bill this year though.

[Tosh]

Yeah, the conning gits had me with that one last year.

I tore a few heads off on the phone about that one.

I have to pay twice a year too; Jan and July; it's called payment on account.

How come you don't?

Just interested!

[MNWC]

Ive done it ever since i went self employed i think there is an amount you can earn before you have to pay on account...it would be nice to know what it was 

Marcus...

[Oakley Windows]

I pay monthly direct debit.

So much easier.

[Alex Gardiner]

Turn yourself into a limited company and it is all a lot simpler. The tax system for sole-traders is quite archaic in this country and really not suitable for running a business. Most firms could make significant savings if they transferred their existing business into a Ltd company.

Ive done it ever since i went self employed i think there is an amount you can earn before you have to pay on account...it would be nice to know what it was 

Marcus...

The limit is £500, as soon as your yearly tax bill exceeds this then you have to start paying on account. Most full-time window cleaners should be exceeding this anyway, otherwise they are just not earning enough to justify their work time (different if you are part-time).

[MNWC]

The limit is £500, as soon as your yearly tax bill exceeds this then you have to start paying on account.

Alex are you sure about that as a couple of window cleaners i know say they only earn 6K after expenses and dont pay on account ??

[Alex Gardiner]

Yes positive. You are allowed your personal allowance of about £5800 without any tax so they will only be taxed on the small amount above this, hence their bill will be way below £500 a year.

[poleman]

If you go Ltd (we have) you can have a nice tax free wage up to 35k a year! (dividend) but that is after you have paid corporation tax! 20% (Small companies’ rate)
 

[m.b.s.]

go ltd accountents dont like it but good for you if you are paying heavy tax

[davids3511]

go ltd accountents dont like it but good for you if you are paying heavy tax

Accountants love it because they can charge you more.