When the time comes to complete your Self Assessment Tax Return, you have 2 options.
1 - Do it yourself
2 - Outsource it
But which do you choose?
Well, it all boils down to time. What you need to do is to take an estimate of how long it will take you. Say your Sole Trader Accounts are particularly complicated, with a lot of money coming in, and a lot of expenses going out of your business.
As an example, let's say that this will take you around 5 hours to complete.
Now, here's where you get the ol' trusty calculator out.
This particular year, you have turned over 100k. Let's work out what this is hourly, so that we can figure out roughly what your time is worth.
So let's say you've worked 48 weeks this year, with 4 weeks holiday. (Rather optimistic for a small business owner!)
So that's 2,083.33 per week that you have brought in to your company. Divided by 40 hours, to get the hourly rate, we get around £52.
So based on the example above, your hourly rate is £52 per hour. This is how much you can bring in per hour, and how much your time is worth.
So to complete the Self Assessment yourself, it will cost you £260 of your time.
Now you need to make a decision.
Depending on what different accountants will charge you for your self assessment, one option will save you money in the long term, whilst the other would cost you.
Say your accountant offers a Self Assessment service, and says to you that they will take care of your Self Assessment for £150. Would you ask them to do it?
Well, of course you would! Based on the numbers alone, it would cost you £110 more just for the privilege of doing your Self Assessment yourself!
But, what you also need to take into consideration is the expert advice that an accountant can provide you with; they know the in's and out's of the tax system, and they know what you can and can't claim.
So, if you are a Sole Trader, or an individual who has to complete a Self Assessment Tax Return, we want you to sit down and work out what your time is worth.
And then use that information to make an informed decision.
That way, you're not costing your business more than you need to! If your time is worth more than an accountant would charge you to complete your tax return, perhaps you would be better off spending your time bringing in more business!
If you need help with your tax affairs, contact J R Accounting Services in Dartford today on 01322 219 121.
We offer the following accountancy services in Erith and around Dartford, Kent
Bookkeeping | Management Accounts | VAT Returns | Corporation Tax | Payroll / PAYE Services | Construction Industry Scheme | Company Formation Process | Self-Assessment Tax Returns
Visit our accounting services page