Somehow I earned a few quid last year. A bit of writing here, a bit of freelancing there. And before I knew it, what appeared in my bank account amounted to a decent-sized hill of beans. Two years after being made redundant, I finally felt like I was back in the earning game, washing my face, and earning enough to buy flannels to wash my children’s. Life felt good.
The only problem was, it didn’t stay in my account for more than a micro-second. After going many months without an income of my own (relying purely on my working wife for hand-outs after we swapped roles and I became a ful-time stay-at-home-dad to our three children), I suddenly found my bank account in the black. And as anyone who ‘works from home’ all day knows, easy access to the internet is both a wonderful – and terrible – thing.
The temptation to buy expensive and exotic ingredients to cook for the Recipe Shed section of my blog became too much. The urge to treat my wife and kids to a little gift here, a mini-gift there, became overwhelming. I felt like I was making a positive contribution again.
But in my enthusiasm to spend, spend, spend I totally forgot that what was in my account wasn’t actually all mine: at least 25% of it was the Taxman’s.
And as January 31 approaches, I am ruing my neglectfulness. For I have been landed with a Tax Bill which seems completely out of proportion to anything I’ve earned on account of a significant proportion of it being what is called Payment On Account.
D’oh!
What’s a Housedad to do?
It’s time to stop spending and start saving.
• Out go the expensive cuts of meat; in come cheaper cuts, such as pork belly, braising steak, chicken thighs and lamb neck. Plus a much more strategically-planned approach to leftovers.
• Out goes the monthly delivery from a wine club; in comes the occasional bottle of cheap(er) plonk from the supermarket.
• Out goes shopping online and the too-simple ‘Click all your favourites’ function (whether you want them or not), not to mention the £4.50 delivery charge; in comes getting out and about to hunt around for the best deals.
Of course, none of the above action will save me the money I need to fend off the Inland Revenue before the end-of-the-month deadline, but they will at least allow me to claw something back to pay off a short-term loan to tide me over.
Then hopefully – fingers crossed – I’ll be able to earn as much this year as I did last year, but with the wisdom of the error of my 2012 financially stupid ways!
• Clydesdale Bank’s instant decision loan offers an APR representative of 5.1% on all loans between £7,500 and £15,000 (subject to conditions).
• This is a sponsored post, the fee for which has already been claimed by the taxman!
I’m self-employed too, and I worked out the total deductions (NHS equivalent, and tax), and now deduct a standard % of everything, straight into an account specifically for tax. Funnily enough, it makes me feel richer to see my stash of cash, even if I’ll hand it over in a few months!