Going independent as a hairdresser or barber gives you the freedom to earn your way. . , however, the issue of money – where can you maximise your take-home pay and save on your tax bill?
With our tax advice for a self-employed hairdresser, you can trim back on any stress regarding your finances. Earn as much as you’re able to with the following tips…
Declare yourself self-employed
If you’re about to move from ‘employed’ to ‘self-employed’, it’s vital to register with HMRC. Not updating your employment status or making a late tax submission can incur financial penalties. You can inform the Government of your new status , and you’ll be given a UTR (Unique Tax Reference) code within ten days. This will also put you on the Class 2 and Class 4 National Insurance register.
Tax has to be declared through a Self Assessment on any income earned from the 6th of April one year to the 5th of April the next. Registering for VAT is only necessary if your business is bringing in more than £85,000 a year. Luckily, you can deduct allowable expenses to work out your taxable profit.
Log expenses with the latest software
One of the most important pieces of tax advice for a self-employed hairdresser is to make yourself familiar with the expenses you can claim tax relief on. These include:
- Utilities payments for the salon (i.e. water, gas, electricity, phone, internet)
- Goods for resale (such as hair products that you have in stock for customers to purchase)
- Office stationery and printing
- Business and liability insurance
- Trade magazine subscriptions
- Training courses necessary for your job or those your staff perform
You should be aware of where costs can be retained in your salon business. Some of them are less obvious than others; by doing your research, and utilising the latest mobile tax software, expense claims are far more accurate.
Again, hairdressers can make this an easy proposition with SimpleTax, the tool for storing, calculating and giving the relevant forms when conducting a Self Assessment tax return.
It’s vital that the information you supply to HMRC is present and correct. SimpleTax can ensure you’re submitting an accurate Self Assessment, and streamlines the process to save you the time and hassle. Explore what we can do for you with a .