10 Self Assessment Tips for Freelancers

Freelancing gives you freedom, but Self Assessment is the trade-off. Here are ten practical tips to make it easier.

1. Separate Business and Personal Finances

Open a dedicated business bank account. This makes tracking income and expenses dramatically simpler.

2. Save 30% of Every Invoice

Set aside 30% of your profit for tax as soon as you receive payment. Adjust this percentage based on your actual tax rate.

3. Track Expenses as They Happen

Do not save receipts in a drawer. Photograph them immediately and log them in your software. Lost receipts mean lost deductions.

4. Claim Your Home Office

If you work from home, claim either the simplified flat rate or actual costs. This is free money most freelancers miss.

5. Keep Mileage Logs

If you drive for business, log every trip with the date, destination, purpose, and miles. Claim 45p/mile for the first 10,000, 25p thereafter.

6. Do Not Forget Training

Courses that update your existing skills are deductible. A web developer taking a JavaScript course can claim it.

7. Claim Your Phone and Internet

If you use your personal phone and internet for work, claim the business proportion. A reasonable split is usually 50% for freelancers who work from home.

8. File Early

You can file from 6 April. Filing early means knowing your tax bill sooner and avoiding the January rush.

9. Budget for Payments on Account

Your second year's January bill includes a payment on account for next year. Budget for 150% of your expected tax bill.

10. Use Proper Software

Spreadsheets work, but dedicated software like Accounted saves hours through bank feeds and AI categorisation.

Penny, our AI bookkeeper, categorises your expenses automatically and flags anything that looks wrong. Try it free for 14 days.