Accounting tips for self employed tutors
If you’re a self employed tutor getting to grips with accounting then this guide will help you get started.
Use accounting software
Accounting software is a great way to manage your finances. Instead of manual accounting which can be time consuming and complicated, the right accounting software can help make it easy. Software like Bokio that uses automation and intuitive design can save you time and help you to keep the right accounts.
Record transactions correctly
Recording your transactions is the first step to doing your accounting. You need to record all your expenses, and any income you make.
The easiest way to record transactions is by using bank feeds. Bank feeds connect your bank account to your accounting software, and automatically import your transactions. All you need to do is record them!
Bokio accounting software makes life even easier by offering smart accounting. We help you find the right account to record your transactions in, and handle the debit, credit and VAT for you so you don’t need to learn double entry bookkeeping. When you use smart accounting and bank feeds, you save time with automation and do your accounting correctly.
You also need to keep track of your receipts. The best way to do this is to upload them to your accounting software. You can either record the receipts instead of using bank feeds, or attach them to your bank transactions. It’s your choice!
To make sure you don’t record the same transaction twice, Bokio has helpful automated matching. You can identify similar transactions and make sure you only record the same transaction once.
Invoice your customers
Invoicing your customers is the professional way to get paid. When you have accounting software with integrated invoicing, you can invoice your customers and record your payment in the same place.
With Bokio, you can create, send and record invoices easily. By saving customer details and services, you can make an invoice really quickly. You can also see whether payment for your invoice is overdue and send polite reminders to your customers.
If you don’t invoice your clients, you can always record your income using bank feeds or filling in the details of your payment.
Get to know your allowable expenses
You can claim expenses back on your Self Assessment tax return! These are called ‘allowable expenses’. They reduce the amount of income you pay tax on. There are some things you can claim on, and some things you can’t:
- Office costs: If you work from an office or from home, you can claim for stationary, utilities and insurance relating to your business.
- Travel costs: If you travel for work and need to stay in a hotel, you can claim this cost. You can also claim tax relief on mileage.
- Clothing: If you wear a uniform or need protective clothing this can be claimed as an allowable expense.
- Legal and financial costs: These include using an accountant, legal or professional fees.
- Advertising and marketing: Spreading the word about your business with adverts and website costs. This also includes professional organisation membership and subscriptions to trade publications if it’s related to being a tutor.
You can only claim on items that are used for your business. You can also claim part of an item if it’s used for both business and personal use. Read our guide to allowable expenses to find out more.
Check up on your business
One of the main benefits of using accounting software is automated reporting. It’s easy to check up on how your tutoring business is performing. Whether it’s seeing your most valuable clients, popular services or seeing your turnover, you can do it all with automated reporting.
Prepare for your Self Assessment tax return
Doing your accounting on a regular basis helps you prepare for your Self Assessment tax return. When you have completed your accounting for the tax year, you can use your profit and loss report to fill in your Self Assessment tax return easily. It’s also important to remember to pay your National Insurance Contribution!
Keep the right records
Record keeping is an important part of being self employed. Whether you work as a sole trader or a limited company, you need to keep the right records for the correct amount of time to be compliant with HMRC. Check out our guide to record keeping to find out what you need to do.
Work with an accountant
If you need some help managing your finances then you can work with an accountant. They can help you with everything including day-to-day bookkeeping, submitting tax returns and financial advisory.
You can get in touch with an accountant to discuss your needs on our Find an accountant page.
Manage your finances with Bokio
Our mission is to make it simple for you to run a business. So, we’ve created an intuitive accounting software that helps make managing your finances quick and easy. Our integrated features and time saving automation give you all the tools you need to get your accounting done.