Frequently Asked Questions
Whether you're starting your first business, self-employed, in a partnership, directing a limited company, or working in the construction industry, you'll probably have questions about your accounts and taxes.
We've answered some of the questions we're asked most often below. If you can't find the answer you're looking for, please get in touch, we're always happy to help.
General Questions
Do I really need an accountant?
Legally, not everyone needs an accountant, but having one can save you time, reduce stress and help ensure you're paying the correct amount of tax. We also provide advice throughout the year, helping you make informed decisions as your business grows.
How much do your services cost?
We offer both hourly rates or fixed-fee packages tailored to your business, so you'll always know exactly what you're paying. There are no hidden surprises, and we'll recommend the right package or price that suits your needs and budget.
Can I switch accountants?
Yes. Switching accountants is usually much easier than people expect. We'll contact your previous accountant, request the information we need and handle the handover, making the process as smooth as possible.
Do you only work with businesses in your local area?
No. While we're proud to support many businesses in our local area, we also work with clients across the UK.
Thanks to cloud-based accounting software and secure online meeting platforms, we can manage your accounts, share documents, and discuss your finances wherever you're based. This means you receive the same personal, responsive service whether you're around the corner or hundreds of miles away.
Of course, if you're local, we're always happy to meet in person, but our use of modern technology means we're never restricted by geography.
Do you offer evening or weekend appointments?
Yes. We know many business owners are busy during the working day, especially those working in the trades and construction industry. That's why we're happy to arrange appointments during evenings and weekends when it's more convenient for you.
Do I really need a separate business bank account?
While sole traders don't legally need a business bank account, having one can make running your business much simpler. Keeping your business income and expenses separate from your personal spending makes bookkeeping easier, saves time when preparing your accounts and gives you a clearer picture of how your business is performing.
For limited companies, a separate business bank account is essential, as the company is a separate legal entity from its owners.
If you're just starting out and aren't sure where to begin, we'll explain your options and help you choose the right setup for your business.
Start-Up Questions
I'm starting a business. When should I speak to an accountant?
The sooner, the better. Speaking to an accountant before you start trading can help you choose the right business structure, register correctly and avoid costly mistakes later on.
Every business is different. We'll explain the advantages and disadvantages of each option and recommend the structure that's best suited to your circumstances, future plans and expected income.
What records do I need to keep?
You'll need to keep accurate records of your income and expenses, invoices and receipts. We'll explain exactly what's required and recommend simple bookkeeping solutions to keep everything organised. We even have a top tip's guide to get you started.
Sole Trader & Partnership Questions
I'm self-employed, what expenses can I claim?
Most businesses can claim expenses that are wholly and exclusively for business purposes. This may include tools, equipment, travel, insurance, office costs and many other expenses. We'll make sure you're claiming everything you're entitled to.
When is my Self Assessment tax return due?
If you file your Self Assessment tax return online, the deadline is 31 January following the end of the tax year. However, you don't have to wait until then. Tax returns can be submitted from 6 April, the day after the tax year ends.
We recommend filing your tax return as early as possible. Knowing your tax bill well in advance gives you more time to budget and save for any payment due by 31 January.
If you're a subcontractor and Construction Industry Scheme (CIS) tax has been deducted from your income, you may be due a tax refund. Filing your tax return early means HMRC can process your refund sooner, helping you get your money back as quickly as possible.
We'll prepare your tax return accurately and submit it on time, giving you peace of mind that everything has been taken care of.
Will you remind me about tax deadlines?
Absolutely. We'll help you stay on top of important deadlines so you don't have to worry about missing them.
What is the difference between a sole trader and a partnership?
A sole trader is a business owned by one person. Although they may employ staff to help run the business, the owner keeps all the profits and is personally responsible for any debts or liabilities the business incurs.
A partnership is a business owned by two or more people. The partners share the profits, responsibilities, and liabilities of the business, usually in accordance with a partnership agreement.
The right business structure depends on your circumstances, goals, and plans for the future. We'll explain your options and help you choose the structure that's right for you.
Does a partnership need to submit a tax return?
Yes. Partnerships must submit an annual Partnership Tax Return, and each partner must also complete their own Self Assessment tax return to declare their share of the profits.
How are partnerships taxed?
The partnership itself doesn't pay Income Tax. Instead, each partner pays tax and National Insurance on their share of the partnership profits through their own Self Assessment tax return.
Should we have a Partnership Agreement?
We strongly recommend having a written Partnership Agreement. It sets out how profits are shared, how decisions are made and what happens if a partner joins or leaves the business, helping to prevent misunderstandings in the future.
Can a partnership become a limited company later?
Yes. Many partnerships choose to incorporate as their business grows. We'll explain the advantages and disadvantages, help you decide if it's the right move and guide you through the process.
Making Tax Digital (MTD) Questions
What is Making Tax Digital for Income Tax?
Making Tax Digital (MTD) is HMRC's new way of managing tax for many self-employed individuals and landlords. Instead of submitting one Self Assessment tax return each year, eligible businesses will need to keep digital records and send regular updates to HMRC using compatible software.
Will Making Tax Digital affect me?
If you're a sole trader or landlord and your income meets the relevant HMRC thresholds, you'll need to comply with Making Tax Digital for Income Tax. If you're unsure whether it applies to you, we'll explain the rules and let you know when you'll need to start.
Do I need special software?
Yes. If you're required to follow Making Tax Digital, you'll need to keep digital records and use compatible software to submit information to HMRC. We can recommend the right software for your business and help you get everything set up. There are plenty ways to do this so if you're not tech savvy don't worry.
Will I still need to complete a Self Assessment tax return?
Making Tax Digital changes how information is submitted to HMRC, but you'll still need to complete an end-of-year declaration to confirm your income and tax position. We'll guide you through the entire process and ensure everything is submitted correctly.
What happens if I don't comply with Making Tax Digital?
Failing to keep digital records or submit updates on time could result in penalties from HMRC. We'll help you stay compliant by keeping you informed of your responsibilities and making sure all submissions are completed correctly and on time.
I'm not very confident with technology. Can you help?
Will Making Tax Digital mean I pay more tax?
No. Making Tax Digital changes how you report your income to HMRC, not how much tax you pay. Your tax liability is still based on your business profits and allowable expenses.Can Dilloway Accounting manage Making Tax Digital for me?
Yes. We can set you up on the right software, set up your digital records, submit the required updates to HMRC and provide ongoing support, giving you confidence that everything is taken care of.
Limited Company Questions
I'm self-employed, what expenses can I claim?
Most businesses can claim expenses that are wholly and exclusively for business purposes. This may include tools, equipment, travel, insurance, office costs and many other expenses. We'll make sure you're claiming everything you're entitled to.
When is my Self Assessment tax return due?
Your Self Assessment tax return is normally due by 31 January following the end of the tax year if you're filing online. We'll ensure everything is prepared and submitted on time.
Will you remind me about tax deadlines?
Absolutely. We'll help you stay on top of important deadlines so you don't have to worry about missing them.
What is the difference between a sole trader and a partnership?
A sole trader runs a business on their own and is solely responsible for its finances and liabilities. A partnership is owned and managed by two or more people who share responsibility for the business, its profits and its obligations. We'll help you decide which structure best suits your circumstances.
Does a partnership need to submit a tax return?
Yes. Partnerships must submit an annual Partnership Tax Return, and each partner must also complete their own Self Assessment tax return to declare their share of the profits.
How are partnerships taxed?
The partnership itself doesn't pay Income Tax. Instead, each partner pays tax and National Insurance on their share of the partnership profits through their own Self Assessment tax return.
Should we have a Partnership Agreement?
We strongly recommend having a written Partnership Agreement. It sets out how profits are shared, how decisions are made and what happens if a partner joins or leaves the business, helping to prevent misunderstandings in the future.
Can a partnership become a limited company later?
Yes. Many partnerships choose to incorporate as their business grows. We'll explain the advantages and disadvantages, help you decide if it's the right move and guide you through the process.
Trades & Construction Questions
Do you specialise in trades and construction businesses?
Yes. Construction and trades is our specialist sector. We understand the unique challenges faced by builders, electricians, plumbers, roofers, landscapers, subcontractors and many other trades.
Can you help with CIS?
Yes. Whether you're a contractor or subcontractor, we can help with CIS registration, monthly returns, deductions and ensuring you remain compliant with HMRC requirements.
Can you help with the Domestic Reverse Charge for VAT?
Yes. The Domestic Reverse Charge can be confusing for construction businesses. We'll ensure your VAT returns are completed correctly and explain how the rules apply to your business.
I work on site all day. Can we speak outside normal office hours?
Absolutely. We know your working day doesn't finish at 5pm. That's why we offer evening and weekend appointments, making it easier to discuss your finances without taking time away from your customers.
Do I need bookkeeping software?
Not always, but cloud accounting software can make managing your finances much easier. We'll recommend the best solution based on your business and show you how to use it.
Can you do my bookkeeping for me?
Yes. Whether you want us to manage everything or simply review your records, we offer flexible bookkeeping services to suit your business.
How much tax should I put aside?
The amount varies depending on your income and business structure. We'll help you understand your tax liabilities throughout the year so there are no unexpected surprises.
Do I need to register for VAT?
Not every business needs to register immediately. We'll explain the current rules, advise whether registration is beneficial and complete the registration process if required.
What happens if I've fallen behind with my accounts or tax returns?
Don't panic. Many people find themselves in this situation. We'll help you get everything up to date, explain any penalties that may apply and work with you to get your business back on track.
Working With Us
What makes Dilloway Accounting different?
We believe accountancy should be straightforward, approachable and personal.
We explain things in plain English, respond quickly to your questions and take the time to understand your business. Whether you're starting your first business, running a growing limited company or working in the construction industry, we're here to provide practical advice that helps you move forward with confidence.
We also know that business owners don't always work 9 to 5, which is why we're happy to arrange evening and weekend appointments when you need us.
Still Have a Question?
If you can't find the answer you're looking for, we'd love to hear from you.
Whether you're just starting your business, looking for a new accountant or simply need some friendly advice, get in touch for a no-obligation chat.