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Working as freelance in UK - Tax return - Accountant
Thread poster: Patti01

Patti01
Local time: 12:27
German to Italian
+ ...
Jan 7, 2011

Hi there!
I have registrered myself as selfemployed in the UK and have to submit my first tax return. I was very surprised when I heard from somebody by HMR that I have to declare the amount I have earned based on the date of my invoices and not the date of the payment of the invoices onto my bank account (sometimes my invoices are paid after 2 months or so). I also invoice generally in Euro and declaring the money when it gets transfered onto my bank account would have been very easy, as my bank sends me everytime a letter stating how much I have received in GBP...
Is that the normal procedure in UK?
I intend to do the first tax return on my own and I am looking for a good accountant (which has worked already with translators) in my area for next year. Anybody can recommend one? Many thanks.


 

Tom in London
United Kingdom
Local time: 12:27
Member (2008)
Italian to English
Easy Jan 7, 2011

Patti01 wrote:

Hi there!
I have registrered myself as selfemployed in the UK and have to submit my first tax return. I was very surprised when I heard from somebody by HMR that I have to declare the amount I have earned based on the date of my invoices and not the date of the payment of the invoices onto my bank account (sometimes my invoices are paid after 2 months or so). I also invoice generally in Euro and declaring the money when it gets transfered onto my bank account would have been very easy, as my bank sends me everytime a letter stating how much I have received in GBP...
Is that the normal procedure in UK?
I intend to do the first tax return on my own and I am looking for a good accountant (which has worked already with translators) in my area for next year. Anybody can recommend one? Many thanks.


Hi Patti

If you are in London I might be able to recommend an accountant.

I can confirm that the amount you declare must be the amount you earned during your accounting period (normally 5 April - 5 April), based on the invoices you issued in that period and whether or not they have been paid. Them's the rules !

As for receiving payment in Euro: it's acceptable to add a note to the invoice stating the final amount actually received into your UK bank account in GBP (since this is in fact the amount you earned).

Your UK bank statements will show the dates on which such payments arrived, and the amounts in GBP.

I hope this helps.





[Edited at 2011-01-07 13:17 GMT]


 

Patti01
Local time: 12:27
German to Italian
+ ...
TOPIC STARTER
Hi Tom thanks Jan 7, 2011

Hi Tom
Many thanks for your reply and help.
I wil need an accountant for next year's declaration, so I would be grateful if you could supply me with a name (I suppose the distance doesn't really matter, as I can send things by post). Do you have any other advice about what I can detract? Thanks again.


 

Sonja Allen  Identity Verified
United Kingdom
Local time: 12:27
Member (2005)
English to German
+ ...
I can't recommend an accountant but there is plenty of help to do it yourself Jan 7, 2011

Hi,

The Inland Revenue and Business Link give free courses on tax returns for the newly self-employed (see their respective websites). I attended two and found them very helpful. They gave me confidence to do the self assessment myself and they give you a chance to ask specific questions. And of course there is the self assessment helpline which can help. Doing your tax return might look daunting when you start out but actually when you get your teeth into it, do some courses and read the helpsheets and other publications (such as the Business Income Manual) on the Inland Revenue website, you can save yourself the expense of an accountant unless you have quite complicated circumstances.


 

Tom in London
United Kingdom
Local time: 12:27
Member (2008)
Italian to English
Private Jan 7, 2011

Patti01 wrote:

Hi Tom
Many thanks for your reply and help.
I wil need an accountant for next year's declaration, so I would be grateful if you could supply me with a name (I suppose the distance doesn't really matter, as I can send things by post). Do you have any other advice about what I can detract? Thanks again.


Patti- I'm sending you a private email.

T


 

Wendy Cummings  Identity Verified
United Kingdom
Local time: 12:27
Member (2006)
Spanish to English
+ ...
this has been covered previously Jan 7, 2011

Although I can´t find the specific posts right now. AFAIK, as my accountant told me, the correct method is this:

Your "sales/turnover" figure is the amount as calculated ON THE DATE OF THE INVOICE. Therefore you need to add up all the sterling amounts and, for Euro invoices, convert them into Sterling using the rate on the date of the invoice.

When the euro invoices get paid, there will invariably be a difference between the invoiced amount and the amount received. You need to record and add together all these differences (positive and negative). At the end of the year, this amount gets classed as an "expense" and is therefore subtracted from (or added to, if you're lucky!) your sales figure, along with other expenses, in order to obtain your taxable profit.

I know it sounds complicated, and when I first found out about it I panicked! But what i've done is include a footnote on my invoices, entitled "for office use only", where I record the invoice value, the exchange rate, the sterling value and then, once the invoice is paid, I add in the amount received. As long as you do it each time, then the figures will all be ready for when you do your tax return.

Hope that helps - and good luck!!!


 

Frances Leggett  Identity Verified
United Kingdom
Local time: 12:27
Italian to English
+ ...
exchange rate Jan 7, 2011

I did my first and second tax returns on my own with some help from HMRC Tax Advisers - if you call the self-assessment helpline they are usually pretty good at clarifying any grey areas if you need some extra help.

They told me when I did my first tax return that the accepted exchange rate was the exchange rate on the 5 April at the end of the tax year you are doing your return for - and they can give it to you.

I imagine that there are other acceptable exchange rates to use as others have mentioned but this is another option.


 

Tom in London
United Kingdom
Local time: 12:27
Member (2008)
Italian to English
My first year Jan 7, 2011

Frances Leggett wrote:

I did my first and second tax returns on my own with some help from HMRC Tax Advisers .


For my first couple of years of self-employment I hired an accountant to ensure I had everything correctly set up with HMRC and that I was keeping my books correctly. Then I continued on my own but if I ever have any doubts about anything I have a friendly accountant who's always available for one-off advice.

Luckily here in the UK the tax authorities are helpful if/when you need to call them and the system itself is fairly simple once you've understood how to do double-entry book-keeping, invoicing, etc.

[Edited at 2011-01-07 17:05 GMT]


 

Patti01
Local time: 12:27
German to Italian
+ ...
TOPIC STARTER
Thanks everybody Jan 7, 2011

Thanks everybody for all the important information.
I'll be doing the first tax return myself and contact the accountant (thanks again Tom) for the next ones. Have a good weekend all of you.


 

Nathalie Suteau
United Kingdom
Local time: 12:27
English to French
My accountant Jan 7, 2011

Hello,

I'm French and I settled down 3 years ago in the UK. I'm amazed how simple it is to fill a tax return in the UK! Nevertheless, I have an accountant to double-check everything. Send me a PM if you want to have her email/phone number.


 

Leo BORGIA  Identity Verified
United Kingdom
Local time: 12:27
English to French
+ ...
Just arrived in the UK Oct 31, 2011

Hello everybody

I've just arrived in London from France and was wondering what I had to do to start as a freelancer here.
I suppose I need to get a NIN and then go the HMR to register right??

Was wondering too if it was better to get accountant at the beginnning.

Thanks in advance for your advice.

Leo


 

Jan Rausch  Identity Verified
United Kingdom
Local time: 12:27
Member (2010)
German to English
+ ...
It is pretty straightforward Oct 31, 2011

I would also suggest saving the money an accountant will charge. Try to do the three basic courses HMRC offer for free and you will see it it quite easy to do without any help, or with help from the HMRC only. I can also confirm that the date of the invoice is the date that matters.
I am currently freelancing in Germany but still a UK resident for tax purposes, which suits me fine as I bet the German tax return wouldn't be as straightforward as the British one.

[Edited at 2011-10-31 19:34 GMT]


 
Post removed: This post was hidden by a moderator or staff member for the following reason: Deletion requested by poster

Paul Sanders  Identity Verified
Local time: 12:27
Romanian to English
+ ...
Re UTR (Unique Taxpayer Reference) number Nov 7, 2011

Hello Rute,

I am a UK national, relatively recently registered as self-employed and a one-time advisor for international students working in UK (although things have changed a bit since then).

What you are referring to -and need, ultimately - is a UTR (Unique Taxpayer Reference) number. This will come to you in the fullness of time, in the post, as a result of your registration as self-employed. However, the UTR is attached to your NI number, as far as I understand and so if you have only just received your NI number you may need to allow another week or two.

If I understand correctly from your post, you have already received your NI no. Believe me, this is most of the battle won.

If it's already been more than a few weeks since you got your NI number, try logging back into your account with HMRC; when they issue the UTR no. your account should be updated to include this information somewhere in the page header.

Otherwise, you should probably phone or go in person to your local govt. tax offices (take yr. NI number, that's how they will find you in the system!) and chase them up "please can you tell me if my UTR no. has been issued yet?" (if you don't know where to go, ask at your local job centre or CAB [Citizen's Advice Bureau] and someone will point you in the right direction.)

In the meantime, I would try putting your NI number on your invoices as theoretically this number connects directly to your fiscal identity in the UK.

I hope this has been useful.

Best regards, Paul


 

xxxfisz_co_uk
United Kingdom
Local time: 12:27
English to Polish
+ ...
Where can I find these free tax courses? Nov 8, 2011

Could you give me a link where can I do tax courses. I'm just starting.
Thank you

Polish translator


 
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