Some people do not think about tax very much. They collect their receipts each month and then send them off to their accountant. They do not look at how much money is going in and out of their business, they just spend what they can and hope that they will bring in enough money each month.
This is a very unwise thing to do. It means that not only do you have no idea as to whether your business is a success or not, but you also will have no idea how much tax you owe. Then when you tax bill does arrive, you may not have the money to pay it. You will not know whether the things that you are doing to promote your business are working or whether they are a waste of money. It could be the downfall of the business.
It is a much better idea to keep a track monthly of what you are bringing in and spending. Even just what you are bringing in. It will give you an idea of how much money you should be saving towards your tax bill.
If you do not have enough money to pay your tax, the Inland Revenue will not let you off, they will not let you pay it off at a later date or anything like that. They will fine you if you do not pay and then you will be in an even worse situation. It is therefore much better to keep on top of things right from the beginning. Always know roughly how well your business is doing and how much tax you owe. Then you will know exactly what you will need to pay and when and you have the money available to do so.
It is a good idea to save some money out of what you earn each month, to put towards paying your tax. Put it in a separate account if necessary, so that you know that it will not be spent by mistake. You may think that it will not be much and not worth worrying about, but you never know what your financial situation will be when the bill comes through and you need to be prepared. So be sensible and think about what you can do to make sure that you do not get any nasty surprises from the tax man. You do not want to struggle financially, when there is no need to.