The UK Tax and Accounting Podcast from I Hate Numbers:

If you want to stay afloat in your business, understand break even and how it can help. Every industry needs this key number for different reasons but regardless of what kind of company or size you are you should have a grasp on these fundamentals!

Understanding and using break even and applying is neglected by many business owners. That's a shame, it's powerful and in helping you make profit, and better business decisions

In this week's podcast I will

Firstly, explain what break-even is

Secondly, why it's so powerful, not only for your bank balance, but also for your mental well

So, what is break-even? In very simple terms, it’s the point at which your total income equals your total costs. Once you hit this magical number, you no longer make a loss on every sale and start making profit! It’s an important marker to know for any business owner.  It tells you when you reach profitability and how much money you need to bring in before you start making a profit.

Break-even analysis can also help with forecasting future sales and budgeting.

If that wasn’t reason enough to love it, break-even is like your personal financial advisor giving you the thumbs up or down on whether a new project or product is worth pursuing. You don’t have to be a maths genius to use it – I have a free online calculator that does all the hard work for you. Why not try out break even today and see how empowering it can be for your business decisions?

Subscribe to my I Hate Numbers podcast where every week we discuss ways small businesses can survive and thrive,

Are you ready to have an easier and more rewarding relationship with your numbers?  My book, I Hate Numbers helps you get there.

This book will show you how to have a rewarding, productive relationship with numbers and your business.  Furthermore, my book will help with that battle between the ears, that all business owners experience.  Learn more and buy my book today!

Get in touch with us to help make your life easier and stress-free. Contact us if you need help figuring out and sorting your numbers, creating your future financial story plans, your tax, payroll and other accounting and business matters

A recession is a difficult time for any business, so knowing How your business deals with a recession is a vital part of your toolkit,

It may be that your customers may have less money to spend, you may have to let staff go, and your bottom line may be shrinking.  But all is not lost, there are things you can do to help your business weather the storm.

In this week's I Hate Numbers podcast I'll look at some ways to deal with a recession and keep your business afloat. Furthermore, your business can even prosper, listen to find out more.

A recession can be a difficult time for businesses of all sizes. Knowing how to deal with a recession and keep your business afloat is essential for any entrepreneur or small business owner. In this blog post, we'll discuss some tips for weathering a recession and keeping your business moving forward. Thanks for reading!

So hopefully these tips will show you How your business deals with a recession. If you have any questions, or want more information on how to apply these tips specifically to your business, please don’t hesitate to reach out. I love talking shop, so feel free to subscribe to my Hate Numbers podcast where every week we discuss ways small businesses can survive and thrive, regardless of the economy. And until next time, keep calm and carry on!

And if you’re still feeling lost or don’t know where to start, our team at Numbers Know offers comprehensive financial planning services that will help get your business through these trying times and into a bright future ahead.

So, what are you waiting for?  Check out our website now and see how we can help get your business back on track!

Are you ready to have an easier and more rewarding relationship with your numbers?  My book, I Hate Numbers helps you get there.

This book will show you how to have a rewarding, productive relationship with numbers and your business.  Furthermore, my book will help with that battle between the ears, that all business owners experience.  Learn more and buy my book today!

Get in touch with us to help make your life easier and stress-free. Contact us if you need help figuring out and sorting your numbers, creating your future financial story plans, your tax, payroll and other accounting and business matters

But cash basis accounting and traditional accounting can produce different profit figures in the same year. Understanding why helps you make sense of your tax return, your business performance and what the numbers are actually telling you.

We use a straightforward decorator example to show how the same business activity can produce a £25,000 traditional accounting profit but a £24,000 cash profit in one year, before the timing difference reverses in the following year.

Cash basis accounting focuses on when money actually moves. Income is recorded when we receive it and allowable expenses when we pay them.

Traditional accounting takes a different approach. It looks at the economic activity of the business, so income and expenses can be recorded even when the corresponding cash has not yet been received or paid.

Neither idea should be confused with simply looking at the balance in your bank account. There are still tax rules around what counts as business income and what expenses are allowable.

If you want the wider foundation first, our guide to What Is Profit? Gross Profit and Net Profit Explained looks at what profit means and why it matters to your business.

Under cash basis accounting, we record business income when the money is actually received and allowable expenses when they are actually paid.

So if a customer owes you money at the end of the tax year but has not yet paid you, that amount is not normally included as cash-basis income for that year. In the same way, an unpaid supplier bill has not yet become a cash-basis expense.

This makes the basic calculation easy to understand:

Cash received – allowable business expenses paid = cash-basis profit

For many items of business equipment, the amount paid can generally be treated as an allowable expense under the cash basis. Cars have different rules.

Traditional accounting, also known as accruals accounting, is based more closely on when the business activity happens.

If you have completed work and invoiced a customer, that income can form part of your turnover even if the customer has not paid you by the end of the period.

Likewise, business expenses can be recorded when the obligation arises rather than waiting for the cash payment to leave your bank account.

This can give a different view of profit because it connects income and costs more closely to the activity that generated them.

Cash basis rules have changed since this episode was originally recorded in 2022.

From 6 April 2024, cash basis became the default method for eligible sole traders and partnerships without corporate partners. You can choose to use traditional accounting instead.

The previous £150,000 entry threshold no longer applies. The old £500 restriction on interest deductions and the specific cash-basis restrictions on loss relief were also removed. If you have more than one business, you can now choose cash basis or traditional accounting separately for each one.

Limited companies, limited liability partnerships and partnerships with corporate partners cannot use the cash basis for this purpose.

You can check the latest eligibility and exclusions in the current GOV.UK cash basis guidance.

Simple does not automatically mean suitable for every business.

Traditional accounting may give you a clearer picture where your business has significant stock, customers who take a long time to pay, substantial amounts owed to suppliers, or where a lender wants accounts showing what the business is owed and what it owes.

Cash receipts can also move sharply between periods. That means cash-basis profit can fluctuate because of payment timing even where the underlying level of business activity has not changed very much.

Imagine a decorator who carries out £40,000 worth of work during the year.

• Work carried out: £40,000
• Materials used: £10,000
• Other running costs: £5,000
• Customer invoices still unpaid at year end: £3,000
• Material bills still unpaid at year end: £2,000

Traditional accounting looks at the £40,000 worth of work carried out, regardless of whether every customer has paid by year end.

£40,000 turnover – £10,000 materials – £5,000 other costs = £25,000 profit

The cash calculation is different because £3,000 of customer invoices has not yet been received.

Cash received is therefore £37,000.

Of the £10,000 materials cost, £2,000 has not yet been paid, so the cash paid for materials is £8,000.

£37,000 cash received – £8,000 materials paid – £5,000 other costs = £24,000 cash profit

We therefore have £25,000 of profit under traditional accounting and £24,000 under the cash basis.

Now imagine the underlying level of work and costs stays the same, but some of those outstanding amounts are collected and paid in the following year.

In the example from the episode, cash received becomes £42,000, material payments become £11,000 and other running costs remain £5,000.

£42,000 – £11,000 – £5,000 = £26,000 cash profit

Traditional accounting still produces £25,000 of profit.

Across the two years, the traditional profits are £25,000 and £25,000. Cash profits are £24,000 and £26,000. The overall £50,000 is the same, but the timing is different.

Cash profits are broadly based on business income actually received minus allowable business expenses actually paid during the period.

For eligible sole traders and partnerships without corporate partners, cash basis became the default method from 6 April 2024. You can choose traditional accounting instead.

No. Limited companies and limited liability partnerships are excluded from this Income Tax cash basis.

Cash basis normally records the income when you actually receive the money, rather than when you issue the invoice.

No. Simplicity is useful, but the timing of receipts and payments can make cash-basis profit fluctuate. Traditional accounting can sometimes give a more useful view of the underlying activity and financial position of the business.

• 00:00 – What cash profits are and why cash basis matters
• 02:17 – How the cash basis calculation works
• 03:45 – How traditional accounting records income and expenses
• 04:24 – Eligibility for cash basis as discussed in the original episode
• 05:59 – Situations where cash basis may not suit a business
• 07:36 – Introducing the decorator example
• 09:09 – Calculating traditional profit and year-one cash profit
• 10:09 – Year-two cash profit and the effect of timing differences

Note: the eligibility rules discussed in the original 2022 audio have changed. The written guidance above reflects the current cash basis position.

• Profit for Tax Explained: Why Tax Profit Differs from Accounting Profit
• How to Budget for Your Tax Bill
• Self Assessment Tax Returns

Cash basis and traditional accounting are different ways of deciding when business income and expenses enter your profit calculation.

Cash basis follows money received and money paid. Traditional accounting follows the underlying business activity more closely. That difference can change the profit reported in an individual year even when the longer-term economics of the business are unchanged.

The right approach is not simply about choosing the easiest calculation. It is about understanding what your numbers mean, how the tax rules apply and whether the method gives you the information you need to run your business well.

The I Hate Numbers podcast helps business owners understand profit, tax, cash flow, bookkeeping, planning and business decisions in a practical way. We simplify business finance so you can make better decisions and feel more confident with your numbers.

If you need help understanding your taxable profit, choosing an appropriate accounting approach or making sense of your business numbers, you can contact us for an initial chat.

You can also use our free online business calculators to support your profit and tax planning, or grab our FREE cashflow guide to help you plan ahead.

For more practical finance and tax support, visit the I Hate Numbers YouTube channel, or listen and follow on Apple Podcasts.

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A self-employed tax return can feel daunting, especially when you are staring at income, expenses, accounting methods and tax terminology that you may only deal with once a year.

But the basic job is much simpler when we break it down.

We need to understand what income belongs in the return, which business expenses we can claim, how our accounting method affects the figures and what checks to make before submitting everything to HMRC.

Working for yourself gives you control over your time, your customers, your money and the type of business you want to build.

It also comes with responsibilities.

One of those responsibilities is dealing with tax, a task that for many people sits somewhere alongside watching paint dry.

This episode focuses specifically on the self-employment section of Self Assessment for sole traders and freelancers.

It follows our earlier guide to completing the main Self Assessment return. That episode looks at the wider return. Here, we concentrate on the business numbers that self-employed people need to report.

In this context, we are talking about individuals who run a business personally.

You may describe yourself as a sole trader, freelancer or self-employed business owner.

A limited company is different. A company has its own corporation tax and company reporting responsibilities, so this episode is not about completing a Company Tax Return.

The self-employment section of Self Assessment is where we report the relevant income, expenses and profit from the business that you operate personally.

Before entering the numbers, we need to understand the accounting method behind them.

The two main approaches are cash basis and traditional accounting.

Cash basis looks mainly at when money actually comes into or leaves the business.

Imagine you complete a job in March and invoice the customer immediately, but they do not pay you until April.

Under cash basis, the income is normally recorded when you receive the money.

From the 2024/25 tax year, cash basis became the default method for most eligible self-employed businesses.

Traditional accounting records income and expenses according to when they are earned or incurred rather than simply when the cash moves.

Using the same example, the March invoice would normally belong to the period in which you earned that income, even if the customer pays later.

You can still use traditional accounting if you choose to opt out of cash basis or if cash basis does not apply to your circumstances.

The important thing is to know which method you are using before you start entering figures.

Another important change since the original episode was recorded is the tax-year basis.

From 2024/25 onwards, self-employed trading profits are taxed according to the profits arising in the tax year itself.

The UK tax year runs from 6 April to 5 April.

You can still prepare business accounts to another date, but if your accounting period does not line up with the tax year, the profits may need to be apportioned so the correct amount falls into the relevant tax year.

For many sole traders, using 31 March or 5 April as the accounting year end keeps things relatively straightforward.

Once the accounting method is clear, we can start looking at the actual business information.

The return needs enough information to work out the taxable profit from your self-employment.

That normally starts with your business income and then deducts the allowable business costs.

Turnover is the income generated from selling your goods and services before deducting your business expenses.

It is not the same thing as profit.

If you use cash basis, the timing of turnover normally follows when you receive the money. Under traditional accounting, the timing follows when the income is earned.

Make sure you include the relevant business income and do not simply copy the amount that happens to be sitting in your bank account at the end of the year.

Next, we look at the costs of running the business.

Typical allowable expenses may include:

• goods and materials bought for resale or production
• business travel and vehicle costs
• staff and freelancer costs
• business premises costs
• working-from-home costs
• repairs and maintenance
• accountancy and other professional fees
• business bank charges and interest
• telephone, internet and office costs
• advertising, software and other business running costs

The important phrase here is business cost.

If something has both personal and business use, we claim only the business part.

For example, imagine your annual mobile phone cost is £600 and you estimate that 80% relates to genuine business use.

The business amount would be £480, not the whole £600.

This principle applies across many mixed-use expenses.

This catches people out.

If you are a sole trader and transfer money from the business to yourself, that is normally a drawing.

It is not a wage paid to an employee and it does not reduce your taxable business profit.

You may call the transfer your wages in everyday conversation, but for tax purposes it is simply money you have taken out of your own business.

So do not include your personal drawings as an allowable business expense.

If you run part or all of your business from home, you may be able to claim an appropriate amount of your household costs.

One approach is to calculate the actual business proportion of relevant costs.

Alternatively, eligible self-employed people can use simplified expenses, which use flat rates rather than asking you to calculate the precise business share of certain household costs.

Whichever method you use, keep it reasonable and connected to genuine business use.

Equipment needs a little more care because the treatment can depend on the accounting method you use.

Under cash basis, most equipment you buy and keep for the business is normally dealt with as an allowable expense. Cars are treated differently and capital allowances may apply.

If you use traditional accounting, qualifying equipment such as computers, tools and machinery may instead be dealt with through capital allowances.

Mixed business and personal use still matters.

If an asset is only 80% for business, we should not automatically claim 100% of the cost.

There is another major change to self-employed tax reporting that did not exist when this episode was originally recorded.

Making Tax Digital for Income Tax started applying from 6 April 2026 to some sole traders and landlords.

If your qualifying income shown on your 2024/25 tax return was more than £50,000, you generally need to use Making Tax Digital for Income Tax from April 2026.

The rollout continues in stages:

• qualifying income over £50,000: from 6 April 2026
• qualifying income over £30,000: from 6 April 2027
• qualifying income over £20,000: from 6 April 2028

Qualifying income broadly means your gross income from self-employment and property before deducting expenses.

If Making Tax Digital applies to you, you need compatible software to keep digital records and send quarterly updates to HMRC.

You still need to complete the year-end tax process and pay any tax due.

The quality of the tax return starts long before you log in to submit it.

Good records tell us what the business earned, what it spent and what evidence supports those numbers.

Keep invoices, receipts and other records supporting the figures in your return.

Self-employed business records normally need to be kept for at least five years after the relevant 31 January Self Assessment submission deadline.

That does not mean we should keep a shoebox of paper and hope for the best.

A decent bookkeeping system gives you better information throughout the year and makes the tax return far less painful when the deadline arrives.

Once the numbers are entered, do not immediately press submit.

Review the turnover.

Look at the expense totals.

Check the business and personal proportions.

Make sure you have not included drawings as wages.

Check that the accounting method and tax year are correct.

If anything looks unusual, investigate it before submitting the return.

Our guide to common tax return mistakes covers several other areas worth checking.

Submitting the return is only part of the job.

You also need to understand what tax is due and when you need to pay it.

Your Self Assessment calculation may also include payments on account towards the following year's tax bill.

If they apply to you, our guide to Payments on Account Explained shows how they work.

If you are worried that you cannot pay what you owe, deal with the problem early rather than ignoring HMRC until the deadline passes.

1. Get your records together. Make sure your income and expenses are up to date.
2. Confirm your accounting method. Know whether you are using cash basis or traditional accounting.
3. Work out the correct tax-year profit. Take account of the tax-year basis if your accounts use a different year end.
4. Check your turnover. Include the correct business income.
5. Review allowable expenses. Claim genuine business costs and restrict mixed-use costs appropriately.
6. Leave drawings out of expenses. Money you take personally is not a deductible wage.
7. Check equipment and capital costs. Make sure you use the correct treatment for your accounting method.
8. Check whether Making Tax Digital applies. Use compatible software where required.
9. Review before submitting. Look for missing, duplicated or unusual figures.
10. Plan for the tax payment. Check the amount due and any payments on account.

A self-employed tax return is the Self Assessment process used to report your personal tax position together with the income, expenses and taxable profit from a business you operate as a sole trader or freelancer.

Yes, from the 2024/25 tax year cash basis became the default accounting method for most eligible self-employed businesses. You can opt for traditional accounting instead where appropriate.

Usually not. Where an expense has both business and personal use, you generally claim only the business proportion.

No. A sole trader's drawings are not an allowable business wage. Taking money from the business does not reduce the taxable profit.

It depends on your qualifying income. From April 2026 it applies to people whose 2024/25 qualifying income exceeded £50,000, with lower qualifying-income thresholds being introduced in later years.

You normally need to keep your business records for at least five years after the 31 January submission deadline for the relevant tax year.

• 00:00 - The responsibility of preparing a self-employed tax return
• 01:46 - What this episode covers
• 02:23 - The main return and self-employment section
• 02:54 - Who counts as self-employed
• 03:38 - Traditional accounting versus cash basis
• 06:08 - Choosing the accounting method and business details
• 08:33 - Reporting turnover
• 09:21 - Claiming business expenses
• 11:16 - Drawings and working from home
• 12:40 - Professional fees, bank charges and mixed-use costs
• 13:17 - Business equipment and capital assets
• 14:58 - Submitting the return and paying the tax
• 15:25 - Self-employed tax return summary

• How to Complete Your Self Assessment Return
• Tax Basics for Self Employed: What You Need to Know
• Payments on Account Explained
• 5 Tax Return Mistakes to Avoid in Self Assessment

A self-employed tax return becomes much easier when the underlying business records make sense.

Know which accounting method you are using, report the correct turnover, claim the business expenses you are entitled to and keep personal spending out of the calculation.

Remember that the rules have changed since the original episode was recorded. Cash basis is now the default for most eligible businesses, profits are reported on the tax-year basis and Making Tax Digital now applies to some self-employed people.

Get the records right first, and the tax return becomes a much more manageable job.

Plan it, Do it, Profit.

If you need help preparing your Self Assessment, understanding your business expenses or working out which accounting method suits your business, you can contact us for an initial chat.

You can also use our free online business calculators to support your tax and business planning.

For more practical finance and tax support, visit the I Hate Numbers YouTube channel, or listen and follow on Apple Podcasts.

📘 Book

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If you need to complete a Self Assessment tax return, the job can look much worse before you start than it does once you break it into steps.

You need to know whether a return is required, gather the right information, complete the main return and any extra sections that apply to you, check the numbers and then deal with the tax bill.

That may not get the pulse racing, but a little preparation makes the process much less stressful.

Completing a tax return is probably not high on anybody's list of favourite ways to spend an afternoon.

For many people, it brings stress, delay and the temptation to leave it until later.

But once a Self Assessment return is required, it becomes one of those jobs that is much easier when you understand what HMRC is asking for.

In this episode, we look at who may need a return, what information to gather, how the return is structured, what to think about with business expenses, the main deadlines and what to do if you cannot pay the bill.

This is also the first part of a two-episode sequence. Here we deal with the wider Self Assessment return. Our self-employed tax return guide then looks specifically at the business section for sole traders and freelancers.

Not everybody needs to file one.

HMRC uses Self Assessment where tax cannot simply be dealt with through systems such as PAYE.

Common situations include:

• you are self-employed as a sole trader and your gross trading income is more than £1,000
• you are a partner in a business partnership
• you need to report certain taxable capital gains
• you need to pay the High Income Child Benefit Charge and it is not being collected through PAYE
• you have untaxed income from property, commission, savings, dividends or overseas sources
• HMRC has asked you to submit a return

There are other circumstances as well, so do not rely on an old list you remember from several years ago.

If your circumstances have changed, check whether a return is still required.

A smoother tax return starts with preparation.

Gather the information first instead of trying to find documents while you are halfway through the return.

Depending on your circumstances, this may include:

• your Unique Taxpayer Reference, or UTR
• employment details such as P60, P45 or P11D information
• self-employed business records and accounts
• property income and expense records
• savings and investment income
• dividend information
• pension contributions
• Gift Aid donations
• information about capital gains
• details of tax already deducted

Your UTR is the ten-digit number HMRC uses to identify you within Self Assessment.

If you are filing for the first time, register early enough to get the information you need before the filing deadline arrives.

A Self Assessment return is not one giant box containing every possible type of income.

There is a main return, and then additional sections may apply depending on your circumstances.

The main return deals with your core personal and tax information.

Supplementary pages can then cover areas such as:

• employment
• self-employment
• business partnerships
• UK property
• foreign income or gains
• capital gains
• non-UK residence

You only complete the sections that are relevant to you.

If you are a sole trader or freelancer, the self-employment section is where the business income and expenses come into the return. We cover that in much more detail in our Self-Employed Tax Return guide.

The figures on your tax return should come from records you can support.

Bank statements, invoices, bookkeeping records, payslips, pension information and other documents help build the picture.

If something is missing, investigate it.

Check your bank account. Look through credit card statements. Review invoices or your diary where appropriate.

Do not simply put your finger in the air and invent a number that feels about right.

If you genuinely need to use a provisional figure because the final information is not yet available, make sure you follow HMRC's rules and correct the return when the final figure becomes known.

If you are self-employed, your business profit feeds into Self Assessment.

Broadly, that means starting with your business income and deducting allowable business costs.

But not everything you spend while running a business automatically becomes a tax deduction.

The expense needs to meet the relevant business-use rules.

Take a trip to Disney because running the business has stressed you out, and you may have a very enjoyable time. That does not make the holiday a business expense.

Travel to meet a client for a genuine business purpose is a different matter.

Some costs sit in the middle.

Your mobile phone or computer may have both business and personal use. In those cases, you usually need to identify the appropriate business element rather than claiming the whole amount.

Our self-employed tax return guide goes further into income, expenses, cash basis, equipment and working from home.

Once the information is entered, take time to review it.

Check that all relevant income has been included.

Make sure you have not entered the same amount twice.

Look at the figures that seem unexpectedly high or low.

Review claims for expenses and reliefs.

Then ask whether the final tax calculation makes sense compared with what you expected.

Our guide to common tax return mistakes covers several areas worth checking before you press submit.

The exact tax year changes, but the normal Self Assessment timetable follows the same key dates.

If you need to complete a return for the previous tax year and you are filing for the first time, or need to reactivate Self Assessment after a gap, you normally need to tell HMRC by 5 October.

HMRC normally needs to receive a paper Self Assessment return by 31 October.

If you owe less than £3,000, already pay tax through PAYE and meet HMRC's other conditions, submitting your online return by 30 December may allow HMRC to collect the bill through your tax code.

The normal deadline for an online Self Assessment return is 31 January following the end of the tax year.

Tax due under Self Assessment is normally payable by the same date.

If payments on account apply, there may also be a second payment on 31 July.

For more detail, see our guide to Payments on Account.

The filing deadline is the last date, not a target date.

Getting the return completed earlier tells you what the tax bill looks like and gives you more time to plan how you will pay it.

It also removes one more job from the back of your mind.

Filing the return early does not normally mean you have to pay the bill immediately.

First, do not impersonate an ostrich.

Putting your head under the duvet, ignoring letters and hoping HMRC forgets about you is not a payment strategy.

Get the tax return filed so the amount due is clear.

Then contact HMRC as early as possible.

Depending on the circumstances, you may be able to arrange a Time to Pay plan rather than paying everything in one lump sum.

The important thing is to engage with the problem before interest, penalties and collection activity make the situation worse.

1. Check whether you need a return. Do not assume the rules are the same as last year.
2. Register with HMRC if necessary. Make sure your Self Assessment account is active.
3. Gather your records. Get your UTR, income details, business records and supporting documents together.
4. Identify the sections you need. Complete the main return and the relevant supplementary pages.
5. Enter all taxable income. Make sure nothing has been accidentally left out.
6. Review expenses and reliefs. Claim what you are entitled to without turning personal costs into business deductions.
7. Check the calculation. Make sure the result looks reasonable.
8. Submit by the correct deadline. Paper and online returns have different filing dates.
9. Plan the payment. Check the amount due and whether payments on account apply.
10. Deal with payment problems early. Speak to HMRC rather than ignoring the bill.

You normally need your UTR plus records covering the income, tax deductions, expenses, reliefs and other information relevant to your circumstances.

No. Being a company director on its own does not automatically mean you need to submit a Self Assessment return. What matters is whether your income and circumstances create a filing requirement or HMRC asks you to file.

Supplementary pages are additional sections used to report types of income or gains that are not covered fully by the main return, such as self-employment, property, employment, foreign income and capital gains.

Yes. You can normally submit it after the relevant tax year ends on 5 April. Filing earlier gives you more time to understand and prepare for the tax bill.

Potentially. If you owe less than £3,000, already pay tax through PAYE and meet the other conditions, HMRC may be able to collect it through your tax code if the return is filed by the relevant deadline.

Submit the return and contact HMRC as soon as possible. Depending on your circumstances, a payment arrangement may be available.

• 00:00 - What this Self Assessment episode covers
• 01:39 - Why completing the return earlier helps
• 02:17 - Income and gains covered by Self Assessment
• 02:47 - Who may need to submit a tax return
• 04:32 - How the tax calculation works
• 05:02 - Main return and supplementary pages
• 05:41 - Information to gather before starting
• 06:51 - Using records and reasonable figures
• 07:24 - Self-employed profits and allowable expenses
• 08:06 - Mixed business and personal expenses
• 09:16 - Capital costs and simplified expenses
• 12:20 - Filing and payment deadlines
• 13:42 - What to do if you cannot pay
• 14:20 - Part one and the self-employed follow-up

• Self-Employed Tax Return: What Sole Traders Need to Report
• Self Assessment Tax Returns
• Personal Tax Return Explained
• 5 Tax Return Mistakes to Avoid in Self Assessment

Completing a Self Assessment tax return is much easier when you know what information you need before you begin.

Check whether you need to file, gather the records, complete the relevant sections, review the numbers and submit the return before the deadline.

Then make sure you understand the tax bill and how you are going to pay it.

You do not need to love tax returns.

You just need a process that keeps the numbers under control and stops January turning into a crisis.

If you need help completing your Self Assessment, checking what you need to declare or understanding your tax bill, you can contact us for an initial chat.

You can also use our free online business calculators to support your tax and business planning.

For more practical finance and tax support, visit the I Hate Numbers YouTube channel, or listen and follow on Apple Podcasts.

📘 Book

https://www.ihatenumbers.co.uk/i-hate-numbers-book/

🎧 Podcast

https://www.ihatenumbers.co.uk/i-hate-numbers-podcast/

🌐 Website

https://www.ihatenumbers.co.uk

Making business decisions in uncertain times can be difficult. There are a lot of things to consider and it can be hard to know what the right thing to do is.

However, by taking a few things into account, you can make decisions that will help your business grow and thrive in any situation.

Here are the A’s, the three tips for making smart business decisions during uncertain times.

• Firstly, Attitude, make sure it’s the right one
• Secondly, Assessment, understand and plan for what is going on
• Lastly, Action, inertia is not your friend

Making business decisions in uncertain times can be tough for business owners. It’s hard to know what the right thing to do is when you don’t have all of the information. That’s why we came up with three tips for making smart decisions during uncertain times.

The first one is attitude, make sure it’s the right one. You need to be positive and believe in your ability to succeed even if things are looking a little bleak. Secondly, assessment, understand what is going on around you so that you can make informed decisions. And lastly, action, inertia is not your friend. Don’t wait too long to take action or else you might miss out on opportunities. To learn more about these tips and how they can help your business thrive during uncertain times listen to our latest episode of the Small Business Success podcast. Thanks for listening

My gift to you, a free Numbers Know How Cash Flow Guide.   Check out my I Hate Numbers YouTube channel,  Subscribe to I Hate Numbers now so you don’t miss an episode.  My book, I Hate Numbers will change your relationship with numbers and money, in a good way.  Check out what people have said, buy the book and make your own mind up, you won’t be disappointed.

If you're a business owner, then you know that the cost of doing business is always on your mind. But what do you do when that cost suddenly skyrockets? Whether it's an increase in rent, wages, or material costs, a sudden spike can be disastrous for your bottom line. Here are a few tips to help you weather the storm.

"Losing your head in a crisis is a good way to become the crisis." C.J. Redwine

Not as much media time, comments through social media, or sympathy, but there is a real cost of business crisis - and not just a cost of living one.

Expect an intensification of 'clench your buttocks', WTF, as the costs of doing business will continue to build and it will feel like a kick in the financial balls. Ouch and wince!

There is no energy cap for businesses, and the eye-watering increases faced by individuals is eye gouging for businesses.

In this podcast I specifically look at how to reduce and manage your energy costs.

For example, businesses that are not work from home ones (of which a gazillion exist, including mine) are facing up to a five fold increase in energy costs.

Support is out there in how deal with energy costs.  However, that may feel like wearing a balaclava as someone hits you with a financial baseball bat.

This episode provides more protection than a balaclava.

 "When everything around you is crazy, it is ingenious to stay calm" - Mehmet Murat ildan

At the risk of understatement, a ton load of businesses are experiencing crappy times, a cost of business crisis - that order of toilet paper will need to be increased.

Unfortunately, the rubbishy times are not unique to business, (Financial Crash 2008 anyone?) though the circumstances may be.

What I do know is that the best way to deal with rubbish times, is

Firstly, attitude and approach - panic is not your friend

Secondly, assessment - don't rely on guesswork

Thirdly, options, there are always options

Fourthly, Financial-Cash flow Plan, you should be doing this anyway

Lastly, Take action - inertia doesn't solve anything

Conclusion

So what does this all mean for business owners? We’re in the midst of a cost of living crisis and it’s impacting businesses in a big way. The good news is that there are things we can do to navigate our way through this very choppy and turbulent storm. In this podcast, I’ve outlined as best I could what a cost of business crisis is, how we should approach it and how we should deal with it.

My gift to you, a free Numbers Know How Cash Flow Guide.   Check out my I Hate Numbers YouTube channel,  Subscribe to I Hate Numbers now so you don’t miss an episode.  My book, I Hate Numbers will change your relationship with numbers and money, in a good way.  Check out what people have said, buy the book and make your own mind up, you won’t be disappointed.

Customer lifetime value and segmentation is this week's episode of the I Hate Numbers podcast.  Last week I kicked off with part one I will be continuing from part one my exploration of customer lifetime value by looking at

• Firstly CLV and net CLV calculation
• Secondly, customer segmentation
• Thirdly, customer retention.

These topics are important for anyone looking to improve their business profits, deliver a positive customer experience, or simply improve their understanding of their customers.

By segmenting customers according to their lifetime value, businesses can focus their attention on those customers who are most likely to generate long-term profits. Customer retention is essential for maintaining profitability, as it costs much less to retain a customer than it does to acquire a new one.

By understanding these concepts, businesses can set themselves up for success in the long run.

Customer lifetime value is a number that tells you how much profit a customer will bring your business over the course of their “lifetime” with you. To calculate this, you'll need to look at your customer's average order value, how often they purchase from you, and how long they stay with you as a customer.

Customer segmentation is a way of dividing your customers into groups based on shared characteristics. This can be helpful in understanding which customers are most valuable to your business and how best to communicate with them.  Take a look at this video for a visual of segmentation, accreditation goes to Hubspot for the table.

Customer retention is important because it costs much less to keep a current customer than it does to acquire a new one

So in conclusion, Customer lifetime value and segmentation is an incredibly powerful number helping you focus on the right customers and increase profits. In order to set this power free though, you need to do a little bit of work up front segmenting your customers correctly and then track their CLV over time.

It’s not rocket science, but it does require some effort.  If you are willing to put in the work however, the rewards can be great.

Are you ready to start harnessing the power of customer lifetime value?  Then listen to find out more.   Check out my I Hate Numbers YouTube channel,  Subscribe to I Hate Numbers now so you don’t miss an episode.  My book, I Hate Numbers will change your relationship with numbers and money, in a good way.  Check out what people have said, buy the book and make your own mind up, you won’t be disappointed.

Numbers gives you business superpowers, you should be Using customer lifetime value as one of those numbers.

In this podcast I will

• Firstly, break down what CLV is
• Secondly, how you can go about calculating it for your own business.
• Lastly, why it's important

So, whether you're just starting out or you've been in business for a while, listen to find out more!

If you're in business, it's important to know how much each of your customers is worth. Knowing your customer lifetime value (CLV) can help you make more informed decisions about where to focus your marketing efforts, and how much to spend on acquiring new customers.

So, there you have it! Using customer lifetime value in a nutshell.  It’s an incredibly powerful number that can help your business in innumerable ways, so make sure to start calculating it today.

In the next part of this series, I’ll take a deeper look at CLV, its power, use and what you need to do to use it.  Listen if you want to increase your profits and get a better understanding of what else is possible when you wield this metric effectively.

Are you excited? I know I am! If you can't wait for more, go ahead and listen to the rest of the podcast episode where we deep dive into all things CLV. You won't regret it!

Check this link to learn more about financial statements.  I invite you to join my Numbers Know How Financial Story Plan Community. I’d love to have you there!

Check out my I Hate Numbers YouTube channel,  Subscribe to I Hate Numbers now so you don’t miss an episode.  My book, I Hate Numbers will change your relationship with numbers and money, in a good way.  Check out what people have said, buy the book and make your own mind up, you won’t be disappointed.

VAT registration impact can be felt across your pricing, profit, cash flow, records and business processes. Once your business becomes VAT registered, you are no longer only selling goods or services. You also collect VAT for HMRC, review how customers respond to price changes, protect profitability and make sure your systems can cope. Understanding these changes early helps you avoid stress, improve planning and stay in control.

The impact of VAT registration on your business explains what changes once your business enters the VAT system.

We look at four key areas: mindset, pricing, profitability and processes. VAT registration can feel like sweet and sour, pleasure and pain. However, with the right preparation, it can also be a sign that your business is growing and needs stronger financial systems.

If you need the registration rules first, our episode on VAT Registration Explained: When You Must Register and When You Don’t is the natural starting point.

VAT registration matters because it changes how your business handles money. VAT collected from customers does not belong to you. It needs to be recorded, protected and paid over to HMRC when due.

It also affects the way you talk about prices, especially if your customers are not VAT registered. A VAT-registered business selling to other VAT-registered businesses may face a different pricing challenge from a business selling directly to consumers, charities or non-VAT-registered customers.

The earlier we understand the impact, the easier it becomes to plan for VAT instead of reacting to it under pressure.

The first change is mindset. Many business owners see VAT registration as something to fear, delay or avoid.

However, VAT registration can also be seen as a sign that the business is growing. It usually means turnover has reached a level where stronger systems, clearer pricing and better financial control are needed.

That does not mean VAT is simple or pain-free. It means we need to approach it as part of running a more mature business.

Once your business is VAT registered, you collect VAT from customers on behalf of HMRC where VAT applies.

That money is not yours to spend. The episode makes the practical point that VAT should be kept separate in your thinking, and ideally in your banking habits, so it is available when the VAT bill is due.

If VAT collected from customers is absorbed into everyday cash flow, the business can face pressure when payment time arrives.

Pricing is one of the biggest practical changes after VAT registration.

If your customers are VAT-registered businesses, they may usually be able to reclaim VAT charged to them, subject to the normal rules. In that case, the price increase may feel more neutral to them.

If your customers are individuals, charities or other non-VAT-registered customers, they cannot normally reclaim the VAT. That means the VAT-inclusive price may feel more expensive, or your business may absorb some of the cost and accept lower profit.

This is why VAT registration should trigger a pricing review. Our episode on Value Added Tax and Your Business: Pricing, Registration and Profit explores that wider pricing and profit connection.

The episode makes an important distinction between selling business-to-business and selling business-to-consumer.

For B2B sales, VAT may be less painful for customers who are themselves VAT registered. They may pay the VAT and reclaim it through their own VAT return, depending on their position.

For B2C sales, the customer usually bears the VAT-inclusive price. That can affect demand, price sensitivity and how much of the VAT cost your business chooses to pass on.

The episode explains three broad pricing options once VAT affects your sales.

• You can add VAT on top of your existing price, which keeps your net price protected but may make you more expensive.
• You can absorb the VAT within your existing price, which may protect the customer price but reduce profit.
• You can share the pain by increasing prices partly and absorbing part of the impact yourself.

There is no one-size-fits-all answer. The right approach depends on your customers, market position, margins, cash flow and confidence in your value.

Profitability is affected because VAT changes the relationship between what you charge, what you keep and what you owe to HMRC.

If you sell mainly to VAT-registered businesses and manage pricing properly, VAT registration may not damage profit and can sometimes improve financial discipline.

If you sell mainly to non-VAT-registered customers and do not review pricing, your profit may fall because part of your sale price has to be treated as VAT and paid over.

VAT registration means your systems need to be strong enough to deal with VAT correctly.

You need records that capture VAT on sales and purchases, invoices that include the right information, and a process for checking what can and cannot be reclaimed.

Our episode on VAT Responsibilities for UK Businesses: Supplies, Records and Returns explains the ongoing VAT duties in more detail.

Once VAT is involved, invoices and supplier records need more attention.

If you are reclaiming VAT on purchases, you need evidence that supports the claim. Supplier invoices should include the necessary VAT information, such as the VAT number, description of goods or services, VAT rate and VAT breakdown.

For more on this, listen to VAT Invoice Essentials: Get Paid Faster, Stay Compliant.

VAT registration is also a prompt to improve your accounting systems.

VAT returns are now closely linked to digital record keeping and Making Tax Digital for VAT. Cloud accounting can help capture sales, purchases, VAT amounts, invoices and reports more reliably.

Good processes are not only about compliance. They also help you make better decisions, plan ahead and understand what is happening in your business.

• Are you monitoring taxable turnover regularly?
• Do you know when VAT registration applies to your business?
• Have you reviewed your prices before registration becomes urgent?
• Do you know whether your customers are VAT registered?
• Will you pass VAT on, absorb it or share the impact?
• Have you protected money collected as VAT?
• Do your invoices include the correct VAT information?
• Can you support VAT reclaimed on supplier invoices?
• Is your accounting software ready for digital VAT records?
• Have you asked your accountant or adviser for support before problems arise?

VAT registration affects pricing, profit, cash flow, invoicing, records, VAT returns and the way your business handles money collected from customers.

Not always, but you should review pricing. If customers cannot reclaim VAT, adding VAT on top may make you more expensive. Absorbing VAT may reduce profit.

It can be easier from a pricing point of view because VAT-registered customers may usually reclaim VAT, subject to the rules. However, you still need correct invoices, records and VAT returns.

You should have reliable accounting software, digital records, VAT invoice checks, a VAT payment routine and a process for reviewing VAT returns before submission.

• 00:00 – VAT registration and unpaid tax collectors
• 00:33 – Four key changes after VAT registration
• 01:58 – Monitoring turnover before VAT registration
• 03:06 – Mindset change around VAT
• 03:36 – Your role as an unpaid tax collector
• 04:17 – Keeping VAT money separate
• 05:22 – Pricing decisions and customer type
• 06:20 – B2B pricing and VAT-registered customers
• 07:06 – B2C pricing and absorbing VAT
• 08:21 – Profitability impact
• 08:58 – Processes, records and Making Tax Digital
• 10:12 – Invoice checks and VAT documentation
• 10:42 – Final recap: mindset, pricing, profit and processes

• VAT in the UK: How It Works and How to Stay Compliant
• Value Added Tax and Your Business: Pricing, Registration and Profit
• VAT Registration Explained: When You Must Register and When You Don’t

The impact of VAT registration goes beyond filling in a form. It changes your role, your pricing, your profit and your processes.

Once VAT registration is on the horizon, prepare early. Review who your customers are, how VAT affects your prices, what happens to profit, and whether your systems can handle VAT records and returns properly.

Plan it, Do it, Profit.

The I Hate Numbers podcast helps business owners understand VAT, tax, accounting, bookkeeping, cash flow and business planning in a practical way. We simplify financial topics so you can make better decisions and feel more confident with your numbers.

If you want support with VAT registration, VAT pricing, bookkeeping, accounting systems or business finance, you can contact us for an initial chat.

You can also watch more practical finance and tax support on the I Hate Numbers YouTube channel, or listen and follow on Apple Podcasts.

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