| Pages in topic: [1 2] > | What are the advantages of getting an accountant? Is it necessary? Thread poster: Gutranslation
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Hello,
I've recently started translation. I had done a few translations gigs in the past, but I really started in Dec 2016. When I filed my taxes in April, I had not earned much yet as I was only starting and had another job. I didn't have to pay any taxes or any NI contributions yet.
From April until now, I've earned around £23000. I've only got two steady clients so far, so it's pretty easy to keep track of my invoices. I have all of them and I keep an Excel file wit... See more Hello,
I've recently started translation. I had done a few translations gigs in the past, but I really started in Dec 2016. When I filed my taxes in April, I had not earned much yet as I was only starting and had another job. I didn't have to pay any taxes or any NI contributions yet.
From April until now, I've earned around £23000. I've only got two steady clients so far, so it's pretty easy to keep track of my invoices. I have all of them and I keep an Excel file with everything I'll need to file my taxes. I didn't think I'd need an accountant yet since I'm not making as much as most other translators yet, I know they're expensive. But I got a flat this year and I had a hard time proving my income as I was so recently self employed and had no accountant to back me up, it's all sorted now, but it was definitely an inconvenient.
Since I'm not experienced, I was hoping some of you could tell me about the advantages of getting an accountant, if it's necessary or not, and if it would be nice to have in my case. Thank you. ▲ Collapse
| | | | Tom in London
United Kingdom
Local time: 23:41
Member (2008)
Italian to English
I used an accountant for many years, at the beginning, to ensure my book-keeping methods were correct. I would strongly recommend it, because if HMRC ever inspect you it's important that everything should be in order.
If you can find a small accountant, such as a "one-man band", you'll find it more personalised and probably a lot cheaper.
After a few years when I had mastered the art of book-keeping and completing my own tax return, I dropped the accountant (although I... See more I used an accountant for many years, at the beginning, to ensure my book-keeping methods were correct. I would strongly recommend it, because if HMRC ever inspect you it's important that everything should be in order.
If you can find a small accountant, such as a "one-man band", you'll find it more personalised and probably a lot cheaper.
After a few years when I had mastered the art of book-keeping and completing my own tax return, I dropped the accountant (although I stay in contact for occasional clarifications of anything I don't understand)
The above only applies to people who are resident for tax purposes exclusively in the UK. As you seem to be based in France, I don't know what the situation is.
[Edited at 2018-01-12 14:54 GMT] ▲ Collapse
| | | | | Tom in London | Jan 13, 2018 |
Hi Tom, I changed my country on my profile. I have actually been living in the UK since 2014 and I am registered with HMRC, I must have been in France when I created my profile. I do not really use Proz at all, so my profile is not accurate.
Thank you so much for your answer, I am a bit lost on what to do as I'm only just starting. I might have a bit of a stupid question. I never consulted an accountant before, so how does it work? Do I just contact them and say "Hello, I'm recently... See more Hi Tom, I changed my country on my profile. I have actually been living in the UK since 2014 and I am registered with HMRC, I must have been in France when I created my profile. I do not really use Proz at all, so my profile is not accurate.
Thank you so much for your answer, I am a bit lost on what to do as I'm only just starting. I might have a bit of a stupid question. I never consulted an accountant before, so how does it work? Do I just contact them and say "Hello, I'm recently self-employed and would like advice on how to do things right?". It might be a ridiculous concern, but I have no idea what I would say. I've always thought that accountants were reserved to people with a lot of clients, and a lot more income, so I have a hard time justifying my need for one.
Also, since it seems you have experience with consulting a professional, how much would it cost me approximately (per annum, I assume. I've seen everything from a few hundreds to thousands), and what kind of services can I expect from them? Maybe you could tell me a bit more about your own experience.
Thank you! ▲ Collapse
| | | | Kevin Fulton 
United States
Local time: 18:41
German to English
| Always start with an accountant | Jan 14, 2018 |
No matter where you live, the tax regulations for self-employed people are always confusing, complicated and seemingly contradictory. I would recommend using an account for the first few years, until you feel competent to prepare your own tax statements (by the way £23000 in your first year is an admirable sum!). Keep accurate records of all income and expenditures!
Although I've been translating for decades, I may have to seek an accountant's advice to deal with the latest revisio... See more No matter where you live, the tax regulations for self-employed people are always confusing, complicated and seemingly contradictory. I would recommend using an account for the first few years, until you feel competent to prepare your own tax statements (by the way £23000 in your first year is an admirable sum!). Keep accurate records of all income and expenditures!
Although I've been translating for decades, I may have to seek an accountant's advice to deal with the latest revision to the US tax code. Major changes in the tax code generally require professional advice. ▲ Collapse
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| Kevin Fulton | Jan 14, 2018 |
Hi Kevin, I know that the UK is a lot more user-friendly in terms of paperwork (Had to fill a US tax form a few months ago, and it was quite complicated...), but I'll probably learn a lot from using an accountant. I am going to look at accredited accountants in my area. Thank you for your encouraging words!
| | | | Angela Malik
United Kingdom
Local time: 23:41
German to English
+ ...
| US taxes too? | Jan 15, 2018 |
If you are filing US taxes too, it is worth looking for an accountant who either does both UK and US taxes or partners with someone who does the US side of things. There are quite a few accountants who work like this in the UK. Especially given the recent tax bill in the US it will be worth it to kill two birds with one stone there, even if it costs a little extra.
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Although I am based in Germany (where I do have an accountant) I have been self-employed in the UK in the past - and I had one then. Paying for an accountant may seem like an unnecessary expense, but it does pay in the long run. As Tom said, if you are inspected it helps a lot to have if your paperwork has been done professionally. An accountant can also save you money quite often by knowing exactly what you can claim for in the way of expenses (it is not always obvious).
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Hi Angela, I am not filing US taxes. I just had to fill a US form so that I precisely wouldn't have to file any taxes in the US as I was working with a client based there. Thank you for your suggestion!
Thank you Sarah, I do think I need some help on what to claim, it would be useful to get advice from a professional.
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Tom in London
United Kingdom
Local time: 23:41
Member (2008)
Italian to English
Gutranslation wrote:
....When I filed my taxes in April....
That seems very early. The 2016-17 tax year ended on 05 April 2017. You have until 31 Jan 2018 (i.e. this current month) to complete your tax return and pay whatever is due.
Are you sure you "filed your taxes" in April 2017? Or maybe you're referring to US taxes....
[Edited at 2018-01-16 11:38 GMT]
| | | | | Tom in London | Jan 16, 2018 |
Hi Tom in London, yes, I did it then because I thought I had to do it early, I did it as soon as I received the letter telling me I had to. I just checked and the tax return copy I have does say "Tax year 6 April 2016 to 5 April 2017". My HRMC account also says "No tax is due at the moment".
I did not realise people waited so long, it really seems like I will benefit from an accountant. Same for this year, I was going to do it in April and pay everything in April as well.
| | | | Tom in London
United Kingdom
Local time: 23:41
Member (2008)
Italian to English
| Best to wait | Jan 17, 2018 |
It's best to wait. Personally, I start going through the Tax Return when it comes online after 05 April. That gives me plenty of time to get the year's paperwork in order. Then in December I go through it again, and click on the final box where it says "your Tax Return is 100% complete" and the website tells you how much tax you'll have to pay.
But I don't actually pay the tax until mid-January. Which was wise this year, because in mid-January HMRC changed my Tax Code and reduced t... See more It's best to wait. Personally, I start going through the Tax Return when it comes online after 05 April. That gives me plenty of time to get the year's paperwork in order. Then in December I go through it again, and click on the final box where it says "your Tax Return is 100% complete" and the website tells you how much tax you'll have to pay.
But I don't actually pay the tax until mid-January. Which was wise this year, because in mid-January HMRC changed my Tax Code and reduced the amount of tax that had been calculated in December.
I think most people pay in mid-January (with a second instalment the following July).
[Edited at 2018-01-17 14:54 GMT] ▲ Collapse
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I see Tom, that makes sense. Thankfully, as I said, I didn't have to pay anything at all last year as I was under the threshold, so I assume that it did not matter that I did it early or not at the time.
I've looked at accountants, I haven't contacted one yet as it feels like an important decision. There aren't a lot close by either. I could really use some help, especially with knowing what I can and cannot claim, I'm a bit lost. You've definitely convinced me that I could really b... See more I see Tom, that makes sense. Thankfully, as I said, I didn't have to pay anything at all last year as I was under the threshold, so I assume that it did not matter that I did it early or not at the time.
I've looked at accountants, I haven't contacted one yet as it feels like an important decision. There aren't a lot close by either. I could really use some help, especially with knowing what I can and cannot claim, I'm a bit lost. You've definitely convinced me that I could really benefit from an accountant, thank you for taking the time to respond. ▲ Collapse
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Tom in London
United Kingdom
Local time: 23:41
Member (2008)
Italian to English
You can't claim much. Translators don't have regular big expenses that are tax-deductible. My biggest regular tax-deductible expense is the rent for my workspace at home, along with the relevant (and justifiable) percentages of my costs for electricity, phone/broadband etc. For occasional big-ticket items like computers I deduct 50% since I also use them for non-work related activities.
There's good general guidance on the HMRC websi... See more You can't claim much. Translators don't have regular big expenses that are tax-deductible. My biggest regular tax-deductible expense is the rent for my workspace at home, along with the relevant (and justifiable) percentages of my costs for electricity, phone/broadband etc. For occasional big-ticket items like computers I deduct 50% since I also use them for non-work related activities.
There's good general guidance on the HMRC website here
https://www.gov.uk/expenses-if-youre-self-employed
Finding an accountant: go to your nearest busy shopping street and look up at the first-floor windows. Accountants often put their names on the glass. Or their nameplate on the door downstairs.
You can also just google for local accountants, then pick one. Like this:
http://bit.ly/2DphnpP
But choose carefully. Remember: you're getting into a quite intimate business relationship. The accountant will want to know everything about what you earn, what you spend etc. Avoid accountants who charge their fees as a percentage of what you earn. That was a big mistake I made, many years ago. The more I earned, the more he took even though his workload was the same. ▲ Collapse
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Thank you for the link, I already read everything related to self-employment on the HRMC website, but I still feel a bit lost about how to handle this. I have an office at home, but I have no idea how to accurately calculate its electricity consumption and such. I guess that I'll have to be approximate (I only moved there this month, so I wouldn't claim anything home-related before January 2018 as I was living with family). I need to start recording every work hour in a spreadsheet or something ... See more Thank you for the link, I already read everything related to self-employment on the HRMC website, but I still feel a bit lost about how to handle this. I have an office at home, but I have no idea how to accurately calculate its electricity consumption and such. I guess that I'll have to be approximate (I only moved there this month, so I wouldn't claim anything home-related before January 2018 as I was living with family). I need to start recording every work hour in a spreadsheet or something similar as well.
I've been googling, sadly there aren't many reviews for accountants so it feels like getting into murky waters. That sounds like a nightmare, thank you for sharing this. I have seen that a few offer quotes though, so I might just do that to get an idea. It does not cost anything to at least enquire.
What do you think of online accounting? While searching online, I found that there are quite a few of them that offer very competitive prices as well. ▲ Collapse
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I claim 10% of electricity etc. as expenses. I work from home and think this is the typical and recommended amount for self-employed people in our situation.
Unfortunately it does not add up to much!
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