Not only do you want to try and find the right person, but you should also make doubly sure that you actually need to be hiring someone new in the first place – especially if you’re a small business where every penny matters.

If you do decide you need to hire someone, you need to consider things like where to find your candidates, how much you want to pay them, and if you want to offer any perks.

We’ll break all of this down for you, and even explain what to do if a candidate makes a counter offer.

Identify the need for a new hire

It can sometimes be obvious that you need to begin the process of finding someone new.

For example, if a previous employee hands in their notice.

Talent retention can be a struggle for smaller businesses who are unable to offer the kinds of salaries found elsewhere, as they simply don’t have the resources.

This means you may have to face the reality that people will come and go – at least until you grow your business to a point where you can offer clear progression.

Other times, it’s less obvious that you need to take on new staff.

You may just notice that your workload is getting a bit much, or that employees are missing deadlines.

These can be indicators that it’s time to start looking for help.

It’s important to think about the long-term. If work is heavy at the moment, because of a specific deadline or project – it may be better (and more cost-efficient) to outsource instead.

If that isn’t the case, and it’s busy around the clock – it’s time to look for your new hire.

Define the role clearly

Once you’ve decided you need to recruit, write up a clear job description which can be used to help advertise the role.

This should outline the key responsibilities, required skills and qualifications, and the preferred experience level.

You’ll also want to explain the reporting structure, as well as what success might look like in the role.

Lastly, if there are any particular benefits or perks to working in your business, be sure to list these, too, as they may help entice potential candidates.

An example might be free parking, or a catered lunch.

Determine salary and employment terms

The next thing to do is undertake some market research into average salary levels for the kind of job you’re looking to fill.

You’ll need to decide on the following:

• Salary range
• Benefits and incentives
• Working hours and flexibility
• Contract type (e.g. full-time, part-time, temporary, or freelance)

Again, if your resources are limited then you may need to place more emphasis on something like flexibility in order to still appear like an attractive option.

Choose where to advertise the role

Conduct more research and figure out which channels or sites will allow you to reach your target demographic.

Examples include job boards like Indeed, professional networks like LinkedIn, recruitment agencies, social media, and of course your own company website so that people can apply directly.

Internal referrals can be another good option given that an employee is unlikely to risk their reputation by referring someone who isn’t a good fit.

Conduct interviews

After drawing up a shortlist of suitable candidates, looking for both technical ability and also cultural fit, you can start the process of interviewing them.

Try to prepare structured interview questions, and in the interview itself, assess such things as the candidate’s skills and experience, problem-solving ability, and their alignment with your company’s values.

Don’t be afraid to hold multiple interview stages if necessary, and do your due diligence as an employer: contact previous employers or professional references, confirm the candidate’s employment history, etc.

You really don’t want to get this decision wrong, so feel free to take your time.

Make an offer

Think you’ve found the one?

Great.

Make them your best possible offer, including things like the salary, start date, and contract details.

Now, when you interview somebody for a job vacancy and offer them the role, they might sometimes respond with a counter offer, so be prepared to negotiate.

Their counter offer could be regarding hours, location, or responsibilities – but let’s be real: it’s usually about pay.

This may have always been their intention, and now that they know you’re interested in hiring them, they feel emboldened enough to try their luck.

Ultimately, it’ll be up to you to decide whether it’s worth it. You could come to an agreement with them. Say, for example, they’re asking for £5k more, you can agree, once they’ve completed their probation period.

Onboard the new employee

All that’s left is to provide a structured induction for your new hire, introducing them to the team and company processes. If it’s your first hire, make sure you’re registered for PAYE, and you understand how payroll works (when it comes to deducting things like NI and income tax).

Reiterate your expectations of them and even set some early goals to get things started.

Of course, you should also make yourself available to offer support and guidance during the early stages.

Before you know it, they’ll be part of the team!

 
Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post How to Recruit Someone to Your Business appeared first on The Cheap Accountants.

Failure to comply can result in content being pulled from the platform or even a permanent ban, so the impact can be significant if you’re a small business looking to invest in social media or influencer marketing.

We’ll look at what the latest guidelines mean for you, and how you might even capitalise on them. Let’s jump in.

What are TikTok’s content guidelines?

TikTok’s policies reflect the requirements of the European Digital Services Act, which is in place for Very Large Online Platforms (VLOPs) with over 45 million monthly users in the EU.

We’ll cover the three main areas one by one, starting with the most timely.

AI-generated content

So-called “deepfakes” are facing the strongest crackdown. In short, all AI-generated content (including images, audio, and video) must be clearly labelled to avoid confusion.

Deepfakes are media generated by AI to depict someone saying or doing something they never actually did. For example, a deepfake will clone a celebrity or politician and then use this to manipulate their audience.

If your business does use AI-generated content, you must indicate this by applying the label “AI-generated content”. This not only safeguards you against compliance violations, but also builds trust with your audience.

LIVE streaming

Creators are expected to take responsibility for their content, making sure it adheres to strict advertising standards when promoting products and/or services in real-time.

For example, much like with AI-generated content, ads and sponsors must now be labelled or demarcated in some way.

There are also strict rules around what you can and can’t advertise, too. For example, you’re usually prohibited from promoting high-risk, age-restricted goods – like tobacco or adult services. Advertising alcohol also comes with strict rules that include age-gating and business authorisation.

Eligibility to go live has also become stricter, with only users aged 18 and above being allowed to do this and monetise streams.

What this means for you is extra due diligence when working with any creators or influencers, including ensuring they are 18 or older, and following TikTok’s guidelines.

Transparency and safety

The responsibilities creators have also include taking care around misinformation and trends that TikTok deems unsafe or even harmful, such as misleading health or financial advice.

Increased responsibility also means increased accountability, and as the business running the campaign, the buck ultimately stops with you. Vet potential partners, and only work with people who are eligible and demonstrate compliance.

What your marketing team needs to know

Let’s look at some numbers.

• Upwards of 30 million people in the UK now use TikTok
• Over two-thirds (67%) of UK brands run influencer marketing campaigns on the platform

As such, compliance with the new rules shouldn’t just be treated as a formality; it can actually give you a strategic advantage over your competitors, allowing you to grow your reach and ultimately expand your client base.

Finding your target audience

Running a social media page of any kind will require a time investment in order to make it worthwhile, and so you want to ensure you’re on the same platform as the people who would be interested in what you have to offer.

This is where it’s useful to consider whether or not your business even needs a TikTok account. Otherwise, you simply won’t see the results you want.

Adapting to the rules

Every business needs some kind of niche to stand out in an increasingly competitive marketplace, but simply positioning yourself as trustworthy and responsible may in fact achieve the same outcome, as many creators will be slow to adapt to these new changes.

To be on the safe side, start incorporating AI disclosure and LIVE safety requirements into marketing campaigns, briefs, and contracts for potential partners.

This will also future proof your campaigns, setting you up for long-term success.

 
Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post Everything Small Businesses Need to Know About TikTok’s Guidelines appeared first on The Cheap Accountants.

You might even need to complete one if you’re employed – for example, because you get money from property which is separate to your employment income.

In this article, we’ll take a look at the different options available for sending a tax return, and also explore Making Tax Digital (MTD) Income Tax.

Filing your tax return using a paper form or online

There are different ways you can file your tax return and pay what you owe, including:

• Online
• Via paper form

Filing your tax return online is the most common method – and in some cases this is mandatory, especially with everything becoming digitalised. But in some cases you can still file a paper return.

When do I need to submit my tax return?

There’s often lots of noise around the deadline for submitting your online return (which is 31st January), but the deadline for submitting a paper return is earlier and must be received by HMRC by 31st October.

Do I need to register before I can send a tax return?

Yes, you’ll always need to register before sending a tax return.

If you’re a sole trader or partnership

If you’re a sole trader or part of a partnership, then the onus is on you to make sure you’re paying the correct amount of tax and National Insurance on your self-employed earnings.

The deadline to register for Self Assessment is 5th October in your second tax year of business.

Thankfully, sole traders can earn up to £1,000 tax-free before they need to register and start sending tax returns to HMRC. This is known as the trading allowance.

If you run a limited company

Limited companies, on the other hand, need to pay Corporation Tax.

Most choose to register for Corporation Tax when they first incorporate the business with Companies House. If you do decide to defer it then you’ll need to register for tax within 3 months of starting to trade.

Does the way I submit my tax return affect when I need to pay the bill?

It can, yes – because the kind of tax return you must send determines what kind of tax you owe and the deadline for paying it.

For example, if you need to complete a Self Assessment then the deadline for paying your bill is 31st January (following the tax year it relates to).

Corporation Tax must be paid by 9 months and 1 day after the end of your company’s accounting period.

Making Tax Digital (MTD)

Now, if you’re used to sending a Self Assessment to report self-employed or landlord income, Making Tax Digital is something you really need to familiarise yourself with – and possibly start preparing for.

In simple terms, it’s a government-led initiative to try and modernise the tax system, while also minimising mistakes in the process. It’s already been rolled out for all VAT-registered businesses, and now it’s being rolled out in phases for MTD Income Tax.

MTD IT will replace the traditional Self Assessment, so instead of an annual tax return you’ll send HMRC smaller, quarterly updates on MTD compatible software, followed by a ‘Final Submission’ by 31st January each year.

You’ll need to follow MTD IT rules by:

• April 2026 if you earn more than £50,000 from self-employment and/or property
• April 2027 for those earning more than £30,000 in the 2025/26 tax year
• And April 2028 for those earning £20,000 in the 2026/27 tax year

An accountant can help make sure you’re complying with the MTD rules, so don’t worry if you’re a bit confused!

What happens if I miss a payment to HMRC?

You’ll incur an automatic fine if you miss a payment, and it gets worse the longer you leave it. Interest is also charged on top of penalties for any late payments. So, if you can’t pay, get in touch with HMRC immediately – as you could prevent this by setting up a Time to Pay arrangement.

If you need help with any of this, don’t hesitate to hire an accountant who will be able to walk you through the process and ensure you’re operating in the most tax-efficient way possible.

 
Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post How to Complete a Tax Return appeared first on The Cheap Accountants.

This is where good financial planning and management come into play, helping to give your business a solid foundation as you look to establish yourself in the market.

In this article, we’ll share some of the best things you can do in the beginning to set yourself up for continued success.

Grab a notepad and pen, and let’s get started.

Do your homework

It can be tempting to just dive in headfirst once you have a business idea you’re happy with. But take a moment to consider how much you actually know about the market you’re looking to enter.

Do you know the ins and outs, or do you have more of a working knowledge?

If it’s the latter, you might want to rectify that before you get up and running. Conducting research into your chosen field shouldn’t just be a formality, though, or an exercise in ticking boxes.

Carrying out good market research and analysis is a sound business practice that can pay dividends in the long run – hopefully literally, if you’re running a limited company!

As well as giving you a good idea of what your operational costs are likely to come in at, early and ongoing market research will help you with things like:

• Setting fees and prices
• Understanding who your nearest competitors are
• What your customer is looking for from you, which will give you a better chance of securing work

Track your spending

Two words: cash flow.

This is super important to understand, but it’s also tricky for new businesses just starting out.

Again, your first impulse might be to cut to the chase and start spending right away, and this actually makes a good amount of sense. You obviously need to invest in your business if you want it to grow, right?

Yes, but you also have to be smart about it. If you miscalculate and then can’t pay your new suppliers on time then you might be out favour before you’ve even had a chance to make a good go of it.

Thankfully, good bookkeeping software can help with this, allowing you to track your spending and use short and long-term forecasting to work out when clients need to pay, so you can pay your own bills on time.

Once you have a cash flow forecast, you can then build in a buffer zone to give yourself a bit of breathing room.

Understand your tax obligations

Now, before you start to nod off, make sure you know what you owe.

The best starting point to this is deciding on a legal business structure. The way you set yourself up, for example as a sole trader or director of a limited company, affect the type of tax you need to pay as well as the deadline to pay it.

Failing to pay the correct amount (or type) of tax can result in hefty fines from HMRC, and no one wants that.

Some of the types of taxes you might need to pay include Income Tax, Corporation Tax, employer’s National Insurance, and VAT.

Being aware of these means you’re in a position to plan ahead, which brings us back to the importance of cash flow forecasting!

Set clear goals

If you want to hit a target, you first need to aim at one. That may go without saying, but it bears repeating.

So, using all the knowledge gained from conducting thorough market research, as well as from your cash flow forecasting, you should try and pinpoint exactly what you want to achieve with your business in both the near and distant future.

This ensures you are constantly improving and making progress, which helps to support long-term growth.

The bit that lots of startups struggle with is the fact that everyone’s goal is “make money”. Looking at all the facts and figures can help you make things a bit more clear cut. For example, “take on one client and bill this amount by this date”.

Leverage technology

If you’re starting a business today, you simply can’t afford to ignore the digital tools and platforms available to you.

Technology can and should create savings, representing a valuable return on investment.

For example, if you’re starting up in retail, you should familiarise yourself with Electronic Points of Sale (EPOS), and perhaps even inventory management systems if you really want to make your life easier.

More generally, you should look at ways you can market your business on social media platforms like Instagram and TikTok, as this is a great way to expand your reach (and hopefully your customer base).

Every business will of course be different in this regard, so find your unique selling point and get creative.

We know it’s not easy taking your first steps in business formation, but put in the effort with financial planning and you’ll reap the rewards.

If you’re unsure about any of this, don’t hesitate to get in touch with an accountant, who will be able to simplify everything and walk you through the whole process.

Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post Top Tips for Financial Planning in the Early Days appeared first on The Cheap Accountants.

What is the sugar tax?

The sugar tax – or the Soft Drinks Industry Levy (SDIL) to use its proper name – is a tax on pre-packaged drinks that contain added sugar.

It aims to function as a kind of deterrent, encouraging drink manufacturers to reformulate high-sugar beverages in order to avoid paying the tax.

What does the sugar tax apply to?
There are also certain exemptions to be aware of though, so the sugar tax won’t apply to:

• Drinks with less than 5g of total sugar per 100ml
• Pure fruit and vegetable juices
• Alcohol-free beer and wine
• Powdered drinks

Pre-packaged milk-based drinks like bottled milkshakes and coffees are technically exempt for now, but this is also set to change from January 2028, including for plant-based alternatives (such as oat milk) with added sugar.

What this doesn’t include, however, are “open cup” milkshakes and coffees prepared in places like cafés, bars or restaurants.

Who pays the Soft Drinks Industry Levy?

The sugar tax applies to manufacturers and importers of pre-packaged sugary drinks, meaning retailers don’t pay the tax directly. That doesn’t mean they won’t feel the effects though, and any business selling sugary drinks is likely to deal with higher costs from their suppliers as a result.

Smaller manufacturers (who produce less than one million litres of drinks above the threshold per year) are exempt from having to pay the tax.

How much is the sugar tax?

The tax basically works on a two-tier system, with the rate of tax depending on the exact amount of sugar contained within each drink.

The levy currently applies to drinks with added sugar that contain more than 5g of total sugar per 100ml. For 2026/27 the sugar tax rate is:

• £1.94 per 10 litres of any drink which has between 5g and 8g of sugar per 100ml
• £2.59 per 10 litres of any drink which has 8g or more of sugar per 100ml

From January 2028, though, the minimum threshold for the lower rate of sugar tax will be lowered from 5g of total sugar per 100ml to 4.5g of total sugar per 100ml. Manufacturers will need to reduce sugar levels by this date if they wish to avoid paying the tax.

How will the changes impact my business?

If you’re a manufacturer the you pretty much have two options: reformulate your product so its sugar content is below the lower threshold, or accept that you’ll have to pay the tax. Either way, the cost is high, and so you’ll likely have to pass it on to customers by way of higher prices.

Companies that choose to pay the tax could spend up to £259,000 a year depending on what tier they’re in.

Sugar tax and smaller retailers

If you’re a small business that sells pre-packaged sugary drinks, you could find yourself being charged a lot more by your supplier. This means you may find yourself having to raise prices in order to try and offset the cost without eating into your own profits.

A bigger chain like Starbucks or Costa is more equipped to deal with higher taxes, whereas independent operators with a select number of locations are more likely to struggle with tighter cashflow.

It’s well worth chatting to an accountant about this. They’ll walk you through the process and also ensure you’re operating in the most tax-efficient way possible, claiming everything you’re entitled to.

 
Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post How Will the Sugar Tax Impact My Business? appeared first on The Cheap Accountants.

In some cases this can be where Debtor Protection Insurance swoops in to save the day. In this article we explain what this type of insurance covers, and who might benefit.

What is Debtor Protection Insurance?

Debtor Protection Insurance is a type of insurance cover designed to safeguard a business against customers who don’t pay their debts, or who cease to trade before they’ve settled an outstanding balance.

It enables businesses to insure themselves against the non-payment of invoices but more importantly, protect against the consequences they would otherwise have to face at the hands of customers who won’t – or can’t – cough up the cash.

It also offers reassurance in a situation where your business has to spend money on services or materials upfront in order to carry out work for a customer. If the customer ceases to trade before the work has been carried out, you run the risk of losing a lot of cash and swallowing up valuable finances for nothing.

The benefits of this type of insurance cover

So, why do so many businesses choose to fork out for Debtor Protection cover? Well, because:

• It helps maintain cash flow when customers fail to pay money owed, or cease to trade
• It helps support business-as-usual, even when you are struggling with late payments
• Generally, it tends to be a low-cost, affordable service (so well worth the investment)
• Many services cover both UK and overseas debts
• Gives you reassurance and peace of mind so you can concentrate on more important things

How does it work?

If you invoiced a customer and they fail to pay you, Debtor Protection Insurance means any financial loss can be absorbed by your provider. You won’t have to suffer the fallout of the financial blow yourself.

In terms of how payments are made, how long it takes to fulfil a claim and other granular details of the process, you’ll need to ask each individual insurance provider as this can vary from policy to policy.

Who needs this type of cover?

Debtor Protection Insurance is something businesses of all shapes and sizes can benefit from. It’s particularly useful for small businesses and start-ups who need to keep an eye on every single penny that goes in and out of the accounts.

For larger, established businesses with a more solid cash flow, late payments might not be such a pressing matter, so insuring debtors may not be top of the priority list. It’s still best practice if budgets permit.

How much does Debtor Protection Insurance cost?

You won’t need us to tell you that the cost of business insurance can vary quite significantly from provider to provider. That makes answering this particular question a little tricky and for that reason, we suggest doing your own research to find out.

How much you pay for your Debtor Protection Insurance cover will depend on a number of variable factors such as how old your business is, your typical monthly turnover, how much is owed to you in invoices, your history of bad debt, as well as any information you provide about outstanding aged debtors.

As with any insurance cover, it’s always a good idea to do your homework and shop around before signing your name on any dotted lines.

Get a few quotes and go through all of the small print with a magnifying glass to ensure you’re working with a reputable provider who will be able to protect your business when it comes to the crunch.

 
Looking for more support with your business finances? Use our resource centre to find cheap accountants and more business support.

The post Should I Get Debtor Protection Insurance for my Business? appeared first on The Cheap Accountants.

From April 2026 the hourly rate for over-21s will rise by 50p to £12.71, with workers aged 18-20 seeing an 85p rise to £10.85, and under-18s and apprentices getting 45p more – going up to £8.00 an hour.

While these changes are undoubtedly positive for employees, leading to a better work environment – they can put a strain on small businesses with tight profit margins, significantly increasing their expenses.

In this article, we’ll explain the key differences between the National Minimum Wage and the National Living Wage and also look at some strategies to help you cope with employment costs in your business.

What is the National Minimum Wage?

The National Minimum Wage is the legal minimum rate of pay UK employers must pay most workers. It applies from the compulsory school leaving age and is set at different levels depending on age and employment status, including apprentices.

Employers are legally required to ensure eligible staff are paid at least the applicable minimum wage rate for their category of work.

The specific rate a worker is entitled to depends on their age group and whether they are an apprentice or not.

What is the National Living Wage?

The National Living Wage is the highest rate within the UK minimum wage system. Despite its name, it’s not directly linked to the actual cost of living. Instead, it’s set as a proportion of median earnings across the UK workforce.

The National Living Wage currently applies to workers aged 21 and over, but it doesn’t apply to those in the first year of an apprenticeship.

Minimum wage vs National Living Wage

In short, you have to pay workers at least the National Minimum Wage or the National Living Wage.

How do you know which one, though?

Again, it depends on the age of the employee and whether they are an apprentice (as different age bands apply). This article explains the differences and what rate applies in more detail.

There’s also the Living Wage (or Real Living Wage) to be aware of. Not to be confused with the National Living Wage, this is voluntary and based on the actual cost of living at the time, reflecting what people need to cover the essentials.

Around 16,000+ UK employers are currently accredited as Real Living Wage employers, benefitting over 490,000 employees. It also benefits businesses too – with 94% of accredited employers stating this.

How are small businesses affected?

A minimum wage rise often hits small businesses first through higher labour costs. Even a small hourly increase quickly adds up, pushing up monthly overheads.

For example, a café with six staff working 30 hours a week would pay about £90 more weekly after a 50p per hour rise – that’s nearly £4,700 a year before extra costs like National Insurance and pensions going through PAYE. For businesses with tight margins, that can make the difference between making a profit or a loss.

Labour-heavy sectors like hospitality, retail, and care feel it most. Businesses may cut overtime, rethink staffing during quiet periods, or raise prices. Over time, the pressure can also affect hiring plans, expansion, and overall growth.

What can small businesses do to adapt?

Like any external factor affecting your small business, identifying issues and adapting to them early on can create more breathing room.

Restructuring is perhaps the most obvious approach, and this involves things like consolidating roles and streamlining processes in an attempt to cut back on spending. It’s not always the most appropriate course of action though, especially if the type of work you’re involved in demands a minimum number of staff on duty.

Alternatively, you could consider outsourcing, which is where you delegate certain tasks to professionals outside the business (e.g. freelancers or an agency). This approach could even be paired with the introduction of new automations to help offset the impact of increased labour costs.

Are there other ways to save money?

Thankfully, there are!

Some employers can use the Employment Allowance to reduce their National Insurance bill by £10,500 each year.

In order to qualify, you need to have at least one employee earning more than the £5,000 Secondary Threshold for National Insurance (or at least 2 directors if you don’t have any employees).

What’s more, you don’t need to be paying more than £10,500 to qualify, either.

If you’re unsure about any of this, an accountant can walk you through the process and also ensure you’re operating in the most tax-efficient way possible, and claiming everything you’re entitled to.

 
Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post Minimum Wage Rises: What Can My Businesses Do to Stay Afloat? appeared first on The Cheap Accountants.

Outsourcing can do more more than just save you money, though. In this article we’ll look at the benefits of outsourcing tasks, and how to find freelancers to do the work.

What is outsourcing?

Outsourcing work means specific business tasks or functions are given to external service providers (usually freelancers) to handle, rather than the work being completed in-house.

It often gives you more choice and flexibility, allowing access to specialist skills if and when you need them.

Different types of outsourcing

There are actually a few different types of outsourcing to be aware of, such as:

• Outsourcing key business-related functions like marketing
• Business Process Outsourcing (BPO) (for example, payroll or customer support)
• Information Technology Outsourcing (ITO)
• Knowledge Process Outsourcing (KPO) – usually highly specialised functions such as accounting or research

Why outsource?

Like anything, there are pros and cons to outsourcing. It can be more cost-effective than hiring a full-time employee, particularly if it’s only for a short-term project.

You won’t need to worry about additional costs or responsibilities (like making pension payments and National Insurance contributions, or arranging Employer’s Liability Insurance).

It can also be faster. Outsourcing a task to someone who specialises in that specific function is likely to mean they’re highly experienced and able to be very efficient.

More broadly, outsourcing gives you access to a large range of skills, many – or even most – of which may not be available to you in-house.

Can I outsource for long-term projects?

Lots of businesses outsource tasks on a long-term basis – such as accounting or legal services, or you might have longer projects which you need help with. Just be careful around the IR35 rules if you do hire a freelancer who comes to sit in your office every day as if they were a regular employee. It can muddy the waters around disguised employment, and that can have tax implications for both of you!

How do I find freelancers?

Most online job sites will simply let you advertise for freelancers, but there’s always the option of looking on freelance marketplaces..

For example, if you’re looking for project-based services you can check out Fiverr, or if you’re looking for a few freelancers that work in a wide range of fields, you might look at Upwork.

These can be a great resource, providing access to hundreds – if not thousands – of available freelancers looking for work.

Most freelance marketplaces even allow you to filter for the exact skills and experience level you’re looking for.

How do I choose a freelancer?

Even once you’ve found some potential options, you still have to make a choice between them. Generally speaking, it’s important to consider things like cost and flexibility.

The idea of selecting the right expert to work with can be daunting if it’s not an area you’re familiar with. After all, that might be why you’re hiring them! It’s usually worth looking at their portfolio or other examples of clients and work, and asking for any testimonials.

Check their portfolio

If you’re struggling to decide whether or not to hire a particular freelancer, previous examples of their work can be very helpful, giving you a tangible idea of what they’d bring to the table.

While a more generalised approach to freelancing may work for those with a diverse set of skills, you typically want to pick someone who specialises in exactly the kind of work you’re asking them to do.

In other words, you want a specialist, not a generalist.

A solid portfolio serves as proof that a freelancer knows what they’re doing, whereas an absent one may be a sign that they’re relatively new (and therefore lack experience).

Look at their track record

In a similar way, testimonials from previous clients are a good sign a freelancer can be trusted to follow through and get the job done.

Hiring someone obviously comes with a high degree of risk, and so any reassurance you can get is vital. If a freelancer is able and willing to give you past case studies to look over, that’s an even better sign.

Get in contact with them

This is a good way to test how responsive they are. Simply shoot them an e-mail and see how long it takes for them go get back to you.

If they take a while, that could be a sign they’re either too busy or don’t see freelance work as a priority. But be fair – they might be away, or this might be a one-off! Either way, it’s a window into how your communication could go if you were to hire them.

 
Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post How Outsourcing Can Help Your Small Business appeared first on The Cheap Accountants.

There are lots of considerations to make, and so, naturally, it’s easy to overlook things. One thing you may have overlooked is whether or not you would benefit from hiring an accountant.

To help you decide, we’ll break down the process of becoming a sole trader, your legal responsibilities, and how an accountant might help.

What is a sole trader?

Let’s start with the basics. A sole trader is just someone who runs their own business as an individual.

There’s no legal distinction between you and the business with this type of structure, so you’re personally liable for anything that happens. This is both good and bad – depending on your circumstances.

Considerations about being a sole trader

On the one hand, your personal assets might be at risk if the business struggles because there’s no distinction beween you and your work. On the other, you get to keep any profits for yourself once you’ve paid income tax and National Insurance. But, you’ll be taxed on them even if you leave them in the business.

It’s relatively easy to get yourself set up as a sole trader, with fewer rules and paperwork than if you were to use a different business structure.

Do I need to set up as a sole trader?

It depends! If you earn less than the Trading Allowance (£1,000) in self-employed income, you might not need to tell HMRC or pay tax on this. You can claim the Trading Allowance even if you have other sources of income, too.

If you do need to set up a sole trader business, make sure you inform HMRC by 5th October in your second tax year. A tax year runs from 6th April to 5th April the following year.

How do I pay tax as a sole trader?

Right, so… You’ve set up as a sole trader and you get more than £1,000 of trading income in a tax year. Now what?

Well, you’ll need to start submitting tax returns to HMRC so you can pay income tax and National Insurance on the profit you make.

What sort of tax return do sole traders need?

This depends on how much you make in total from self-employment and/or property income in a tax year. You’ll normally start by submitting Self Assessment tax returns.

Over time, you might also need to consider Making Tax Digital (MTD) Income Tax. As it continues to roll out, MTD Income Tax will gradually replace Self Assessment for some people.

Those affected will need to keep their income tax records digitally, and share this information with HMRC on a more frequent basis using compliant software.

• You’ll use MTD to report your tax from April 2026 if you earned more than £50,000 as a sole trader and/or rental income in the 2024/25 tax year
• In April 2027, the earnings threshold to start complying reduces to £30,000 earned in the 2025/26 tax year
• From April 2028, it’s £20,000 for the previous tax year

How do I make a tax payment?

HMRC will calculate your tax bill once you submit your return. There are many methods you can use to pay, including HMRC online, Direct Debit or bank transfer. If you work for an employer and have a sole trader business on the side, you may be able to pay your self-employed tax bill through your PAYE tax code.

The deadline to pay is 31st January each year (the same as the deadline to submit your tax return for the year). If your tax bill exceeds £1,000, you’ll need to make ‘Payment on Accounts’ – which essentially splits your tax bill in two halves. The second tax payment deadline is 31st July.

What are my other responsibilities?

You want to . This will be essential in helping you fill out your tax return, and will also help you to claim tax relief without forgetting about any allowable expenses.

Do I need an accountant?

Having an accountant can be extremeley reassuring. They’ll:

• Help you set up processes for keeping clear, up-to-date financial records – known as bookkeeping
• Advise how to optimise any tax reliefs and allowances, and make sure you’re claiming any allowable expenses
• Suggest software you can use for bookkeeping, or for MTD compliance if this applies to you

There are lots of different types of accountancy services available, so take your time to understand exactly what sort of support you need, and make sure your accountant is appropriately qualified.

Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post Do Sole Traders Need an Accountant? appeared first on The Cheap Accountants.

In this article we’ll go over what an employer’s payroll responsibilities are, and some of the most common pitfalls to watch out for.

What is payroll?

In the simplest terms, your payroll is a record of all the people in your business and how they’re compensated for their work. The process of “running” payroll refers to the method by which pay is worked out, documented, and reported.

What are some common mistakes employers might make with payroll?

While running payroll may seem simple enough, it’s easy to get things wrong. There are so many things to keep track of, and you might not even be aware of everything you need to do!

Common issues can include not claiming the Employment Allowance, overlooking non-cash benefits which should be taxed (known as benefits in kind), and pension schemes. We’ll go into more detail below.

Not claiming your Employment Allowance

This is a big one. The Employment Allowance is a type of relief available to some employers which helps reduce the cost of their National Insurance contributions by up to £10,500 each year.

Once you use up the allowance, you’ll start making contributions as an employer again. You don’t even need to be paying more than £10,500 to qualify, either; you can still benefit if your bill for employer’s NI is less than this.

It’s important to note that this only applies to your contributions, not your employees’.

Not paying tax on a benefit in kind

Some employers will provide non-cash perks as part of the ‘package’ they give to employees. Company cars are the most common example of this.

The employee or director who receives the benefit will often need to pay income tax on it, just like they would if they received the equivalent value in the form of a salary instead. They might also need to pay NI on the benefit if it’s cash, or if it’s something they can sell or turn into cash, rather than keep.

Employers are also required to make Employer’s National Insurance Contributions on the value of any benefits in kind they provide.

All this means the benefit must be reported by the employer to HMRC so that it can be included in the calculations for tax and NI. Make sure you report them through payroll, and on time to avoid penalties!

No workplace pension scheme

Another responsibility you have as an employer is to set up a workplace pension scheme for your staff, automatically enrolling anyone who’s eligible. Now this isn’t optional, it’s a legal requirement if:

• You have employees aged between 22 and State Pension age
• They earn more than £10,000 per year
• Your business is in the UK, and your employees each have a contract of employment
• Your employees’ day-to-day duties are in the UK

The way it works is you as the employer deduct a pension contribution from an employee’s wages and then pay the amount into the scheme on their behalf, along with your own contribution. The minimum contribution is 8% of the employee’s pensionable earnings (and at least 3% must be from you as the employer).

Note: these contributions are in addition to National Insurance contributions, rather than instead of.

It’s also part of your obligations as an employer that you give your employees the option to opt out of the workplace pension scheme if they want to, so don’t overlook this!

You’ll need to make sure you have good systems in place to check who should be auto-enrolled, removing anyone who opts out, and setting reminders to repeat the process using the mandatory timeframes. The Pensions Regulator has a checklist of everything you need to do and when.

Hiring someone as a freelancer vs. as an employee

If you’re a business owner and haven’t come across IR35 before, it’s time to get clued up.

IR35 was introduced to minimise the risk of tax avoidance caused by someone working through their own limited company, when they would otherwise be considered employed based on the type or amount of work they’re doing.

In other words, they would simply work for their client as a regular employee if the intermediary didn’t exist.

Failing to comply with the rules can result in financial penalties, so our guide goes into more detail about who is responsible for checking IR35 status, and what to do if you employ someone inside the IR35 rules.

 
Find more help in our online accounting hub, and learn more about how to find the right accountant for your business.

The post Common Payroll Mistakes and How to Avoid Them appeared first on The Cheap Accountants.