82% of sole traders want to improve their financial fitness in 2022

Four in five (82%) sole traders want to get financially fitter in 2022, according to new research from global technology platform Intuit QuickBooks. However, as the self-assessment deadline looms, the time spent on tax returns is preventing many from meeting their goals.

HMRC has suspended the automatic penalties for self assessment; sole traders will now not incur the late filing penalty as long as they submit their return before 28th February. However, interest is still charged on late payments from 1st February, meaning it is in the sole traders’ best interests to meet the original deadline.

The self-assessment process can be time-consuming, with the average sole trader spending 16 hours completing their tax return. Many admit, however, that it takes longer than it should, either due to putting it off (40%), a lack of confidence (30%) or a lack of knowledge (21%).

This time spent on tax returns is eating into sole traders’ ability to meet their goals – a lack of time (32%) is one of the main reasons that the overwhelming majority (83%) of sole traders tend to give up on their resolutions.

Simplifying tax returns means resolutions are more likely to succeed

Cutting down the time spent managing taxes has multiple potential benefits for sole traders, with half (50%) saying they would be more likely to keep their resolutions if their self-assessment return was easier.

This includes not only financial ambitions, but health and wellbeing goals too (with 90% of sole traders also having fitness resolutions like exercising more or eating more healthily).

Pauline Green, Head of Product Compliance and Programs at Intuit QuickBooks adds: “Tax returns don’t need to be taxing. HMRC has given many sole traders a welcome break from late penalties, and more help is at hand. Digital software provides additional support by automating the Self-Assessment tax return process, giving sole traders back valuable time which can be much better spent on improving financial fitness or overall health and wellbeing.

“Financial management platforms also provide quick and easy access giving up to the minute, real-time data to give sole traders the insights needed to improve their finances-setting them up for the best possible success.”