While operating a business, keeping track of income, expenses, and of course, the correct amount of tax you should be paying is no easy task. Maintaining an efficient, organised payroll is a job in itself. In a bid to stay on the right side of tax law in the UK, many contractors, businesses, and recruitment agencies prefer to engage the services of a reputable umbrella company to take care of this vital function.
File Tax Returns On Time
If you delay sending income and expenses details to HMRC for tax purposes, you could receive a penalty. Smart business owners tend to outsource financial services from companies who specialise in payroll services to save freelancers, limited companies, and recruitment agencies the hassle of ensuring their business finances are submitted to HMRC on time.
Learn Current and New Tax Legislation
Alongside running a business, keeping up with every existing and upcoming business-tax law is impossible. With a wealth of details and clauses that often accompany acts permitted by parliament, overlooking specific sections of a business-tax law could have a devastating impact on your business’s finances. Business owners and contractors are accountable for staying on the right side of the tax law, which single-handedly is challenging to accomplish without an umbrella payroll from People Group Services. For instance, you may have concerns about if IR35 applies to you and how it will affect your income in April 2020. Hiring a payroll service will ensure your finances are compliant with tax law to avoid any fines.
Keep In Touch With HMRC
Updating HMRC on any changes such as the financial status of your business or a change of business address is essential to prevent, for example, important letters regarding paying tax being sent to the wrong address. However, keeping in touch with HMRC regularly is also time-consuming. By sourcing payroll services, you can transfer the duty to your umbrella company to contact HMRC, should there be any significant changes or information they need to know.
Unless you’re trained in managing and organising a payroll and have the time to review existing and new tax legislation, the task of keeping up with changes in tax law may be challenging. It’s highly likely you’re unsure about by which tax rules your business needs to abide. If this is the case, researching and outsourcing your payroll services is a wise decision that will ensure your finances are consistently compliant with HMRC. This will free up more time for you to focus on other areas of your business that need your attention.