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Making Tax Digital (MTD) for Income Tax requires more than simply submitting a report every quarter. If you are affected by the new rules, you must keep digital records of your business income and expenses and use HMRC-compatible software to submit your quarterly updates. It is important to remember that quarterly updates do not replace…
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One of the most common mistakes when closing self-employment with HMRC is failing to officially notify them. If you don’t report that you’ve stopped trading, your self-employed status remains active, and HMRC will continue expecting annual Self Assessment tax returns even if you have no income. Another frequent issue is an incorrect final tax return.…
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If you stop working as self-employed in the UK, you must officially inform HMRC. Simply ceasing activity is not enough — until you notify HMRC, you are still considered self-employed and may be required to file tax returns. To close your self-employment status, you need to deregister through your HMRC Self Assessment account or contact…
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Many business owners assume they can simply strike off a company even if it has outstanding debts. However, creditors can object to the strike-off, and in many cases this route is not allowed at all. If a LTD company cannot pay its debts, a formal insolvency procedure may be required instead of strike off. Directors…
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If a UK Ltd company is no longer trading, it must still be formally closed. Simply stopping business activity does not remove legal obligations to HMRC and Companies House. If the company has not traded for at least 3 months, has no debts, and meets other conditions, it may be eligible for voluntary strike off…
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Many self-employed individuals incorrectly assume that any partially business-related expense can be claimed in full. In reality, HMRC only allows the business proportion of mixed-use costs. This commonly applies to mobile phones, internet bills, vehicles, and working-from-home expenses. Another overlooked mistake is failing to set aside tax throughout the year. Since tax is not deducted…
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One of the most common mistakes is mixing personal and company finances. Company funds belong to the company, not the director, and using a business account for personal expenses can lead to additional tax liabilities and accounting issues. Another frequent mistake is missing filing deadlines with Companies House and HMRC or failing to maintain up-to-date…
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If you are self-employed, it is important to understand that not every payment made from your business account can be treated as a business expense. According to HMRC rules, expenses must be incurred wholly and exclusively for the purposes of your business. Money spent on personal needs is not an allowable business expense and cannot…
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When hiring an employee in the UK, employers collect key payroll data including personal details, address, start date, National Insurance number, and tax information for PAYE. Without this information, payroll processing and HMRC reporting cannot be completed correctly. A Right to Work check must be carried out before the employee’s first working day. The employer…
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Employers often miscalculate holiday entitlement for part-time or zero-hours staff and fail to correctly track irregular working patterns. These errors can quickly lead to compliance issues. Another frequent mistake is not including regular overtime or commission in holiday pay calculations, which can result in underpayment and backdated claims. We help businesses audit payroll processes, fix…
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