When Spending A Few Hundred Could Save You Thousands

Do you earn over £100k a year? Do you own a substantial amount of property? Perhaps you have a savings income? If any of these apply to you then you will have to complete your own Self Assessment Tax return. This can be a bit of a pain, but nonetheless it's essential.

Because it's a bit of a drudge and because getting it wrong could have implications many of us choose to hire a professional to help us with this yearly chore. Many don't, so you have to ask yourself why? Is it really worth the extra costs of paying someone to help, fill out a form?

The expertise is in knowing what you can claim for and what will get you in trouble: The main reason millions of us, hire an accountant at this time is that, they have a full and complete understanding of the tax process. They understand what expenses we can claim for and the allowances we are eligible to receive. The Head of Personal Tax at PWC, Mr John Whiting told The Independent that there value add was ensuring you get your allowances and as many tax deductions as you can.

It appears that the complication of completing the return and the fact it is an annual event is putting people off. It's amazing really that a tax system requires us to incur further costs to complete a return. However, as it stands today, the use of an accountant seems to be the de rigour and you can understand why.

It's a chore that drains time: As already stated, a tax return can be hard work and can eat up time easily. This is doubly true if you have numerous income sources, some of which could be from investment, savings, property as well as working for yourself. With all these crossed wires, settling on using an accountant is understandable, especially as they know how to calculate tax returns in their sleep.

While investigating the use of accountants in 2007, The Guardian newspaper came down on the side of diy, believing it to be easy enough to complete by yourself. "If you've got an appetite for the fine detail... and are willing to put in the legwork, you can easily do it all yourself."

Though The Guardian must have a perverse sense punishment you must be thinking, if a nightmare for you is keeping track and organising hundreds of invoices/receipts, then getting an expert in might be the best thing for you.

Keep your hard earned in your pocket: Ironically, hiring an accountant could actually save you a bit of money, as crazy as it sounds! The Guardian further reports that "a good accountant will almost certainly recoup the cost of the work they do for you in the efficiencies they make in your financial affairs". It may surprise you to know that the main reason people do hire an accountant is to save them money.

If you have different sources of income it may well be advisable to set up a Limited Company and receive dividends. This may reduce your tax bill but the person to advice you on this would be an accountant. If this works then the benefits of the advice far outweigh the costs of the advice in the first place.

Simple accounting work can start from as little as £150-200. Not only will you benefit from spending less time on your financial affairs but you can also save money by benefiting from an accountant's specialist advice in how to reduce your tax liability.


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