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We've scoured the web to get you the most up-to-date advice which includes the most useful tools on offer from the officials themselves.

Effective tax planning is essential if you are to minimise your tax bills. Simple tax planning can significantly reduce your tax liabilities.

The self-assessment tax return is an unavoidable burden if you are liable for self-employed tax or have complicated income tax affairs.

Corporation tax is charged on a company's profits. If you trade as a limited company, ensure that paying this tax is as painless as possible.

National Insurance Contributions (NICs) are payable whether you are self-employed or employed by your own company, although different rates apply.

As well as your legal obligations, you’ll want to ensure that payroll is painless and that you use any opportunities to improve your tax-efficiency.

VAT

Effective VAT planning aims to ensure that VAT is relatively painless, and that you are reclaiming as much as possible of the VAT you pay.

Capital gains are made when you sell something for more money than you paid for it. As a result, you can be subject to tax. Take professional advice.

Business property taxes apply to businesses with commercial premises.There are two commercial property taxes: business rates and stamp duty land tax.

If you have tax problems or face a tax investigation, it pays to seek professional advice and you must act rather than just hoping for the best.

Freelancer fortunes improve as economic bounce back begins

11 May 2021

The latest survey of sole traders shows that UK freelancers have seen a "remarkable" recovery in earnings in the first quarter of 2021 after an incredibly difficult year.

New research conducted by the Association of Independent Professionals and the Self-Employed (IPSE) and PeoplePerHour has found that freelancers' earnings and confidence in the economy saw a "remarkable recovery" to pre-pandemic levels in the first quarter of 2021.

In Q1 2021, freelancers' average quarterly earnings stood at £20,778 - 20% up from £17,283 at the end of 2020. At the same time, freelancers' average spare capacity (the number of weeks they go each quarter without work) dropped from 4.3 weeks to 3.7 weeks. Although this is still not quite back to pre-pandemic levels, the findings show that freelancers compensated by raising their day rates.

Freelancers' confidence in the UK economy also dramatically rose. Short-term (three-month) confidence increased from -27.8 to -4.3, which is the highest it has reached since Q4 2015, before the EU referendum. Long-term (12-month) economic confidence rose from -27.7 to -0.2 - also the highest since Q4 2015.

The key metric that has not significantly recovered is freelancers' confidence in the performance of their own businesses. This is the first time since 2014 that freelancers have had less confidence in their business than the economy. Respondents said that "government regulation related to hiring freelancers" and "government tax policy" were the two main factors negatively affecting their business - ahead of the pandemic.

Andy Chamberlain, IPSE director of policy, said: "The roadmap to opening up the UK has driven a remarkable recovery in freelancers' earnings and also their confidence in the economy. Economic confidence among freelancers is in fact now at its highest level since before Brexit. After a dark year in which they were disproportionally hit by the financial impact of the pandemic, freelancers are again seeing cause to hope … Historically, the freelance sector has always been a key driver of economic recovery and it is clearly raring to go.

"Amid the optimism, however, there are also lingering causes for concern. Above all, the recent changes to IR35 are clearly damaging freelancers' confidence in the future of their businesses - not unreasonably as they see the chaos now running through the contractor hiring market."

Meanwhile, the latest quarterly SME Trends Survey from the CBI shows that SME manufacturing output is expected to improve markedly in the coming quarter. Its survey of 260 SME manufacturing firms saw optimism grow at the fastest pace in seven years. The volume of total new orders grew, reflecting a rise in domestic orders, while export orders were flat. In the next quarter, output and domestic orders are expected to bounce back, with predictions for output growth at the strongest in the survey's history (since 1988).

Written by Rachel Miller.

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