Nobody Panic - How to Do Your Tax Return with John Robins

Episode Date: January 11, 2022

The brilliant John Robins explains tax to Stevie and Tessa who ask questions like 'what is tax?' and 'how do I do it by myself without crying?'. Not just for the self-employed listeners, there's lots of good stuff in here for everyone - mainly because John has such a nice voice. Listen to John's podcast The Moon Under Water here.Watch Bad Golf here.Subscribe to the Nobody Panic Patreon at patreon.com/nobodypanic Want to support Nobody Panic? You can make a one-off donation at https://supporter.acast.com/nobodypanic Recorded and edited by Naomi Parnell for Plosive. Photos by Marco Vittur, jingle by David Dobson. Follow Nobody Panic on Twitter @NobodyPanicPodSupport this show http://supporter.acast.com/nobodypanic. Hosted on Acast. See acast.com/privacy for more information.

Hello, I'm Carriad. I'm Sarah. And we are the Weirdo's Book Club podcast. We are doing a very special live show as part of the London Podcast Festival. The date is Thursday, 11th of September. The date is 7pm and our special guest is the brilliant Alan Davies. Tickets from kingsplace. It's coming to London. True on Saturday the 13th of September. At the London Podcast Festival. The rumours are true. Saturday the 13th of September at King's Place. Oh, that sounds like a date to me, Harriet. to Nobody Panic with me, Stevie and Tessa. Hello. That's it. That's what there is. That's it. And today we've brought in a third because obviously January, shittest month ever, we thought, what makes it the shittest month ever? Possibly it's tax if you're freelance.

And if you're not, you can still listen because it'll be very jolly and you'll learn something anyway. In fact, definitely listen. And we've got probably the best sort of taxer that I've ever heard of. It is, I mean, you've got too many jobs. It's a comedian, writer, podcaster, YouTuber, sort of visionary, vibesman, taxman, John Robbins. Hi there, everyone.

Thank you so much for coming on. I should point out, I'm the best unqualified taxer. So I am not qualified to give individual tax advice. Just need to really make that clear. If you want to get in touch with John through his contact details, he can do your tax return this year. For free as well, he loves tax so much that actually that's what he does now. Famous accountant who transitioned into comedy.

We've been wanting to do this for him for a long time because people write to us about how hard it is. We've both found it obviously nose-bleedingly stressful. And I would say that before we managed to find outside help and get an accountant, 29th of January was obviously a terrible day. Well, even now, I have, I have an accountant and I cry. Yes.

Because she just asks me to like give her my bank statements. And even that, I'm like, shaking. Yeah. But what if it's right? And also I'm like, what if it, she sees something and she thinks it's income, but it's not? And I end up going through everything anyway, but I don't really know what I'm looking for. So I'm just sending her like wild capital emails and they're all cool things like, tax! And then it'll be like, this transaction isn't, is this?

And she's like, you know, I know. And she has to explain to me what like a threshold is every year and I'm in the same one every year so I don't know why I need to ask. I'm getting very hot, not a fun way, thinking about it. It's a hot and horrible subject because not only is it extremely confusing and if you are freelance, you have maybe chosen not a natural path. Not natural lifestyle.

And then to be faced with this thing once a year with all these numbers and all these codes and then hanging over that the threat that you might go to jail at any point. It's such a stress. Do you love tax as much as you purport to love tax, John? Yeah, I do, but that's, I guess, less of a sort of, less of my admin obsession and my neatness obsession, and more, that's more like my sort of political philosophy

is that tax is emergency services, it's mental health care, it's the NHS, it goes into helping people who need the help most. So sort of, you know, philosophically, I agree with tax. You know, no taxation without representation because there used to be taxation for many hundreds of years with no representation so you would pay money to the king

to fund wars but you would receive nothing in return so it's a relatively modern thing taxation with representation and I think a point I've made before on like radio show and stuff is that there's a slight identity crisis I think that HMRC has

where they used to run these adverts like we're coming for you and like an eye period for a hole and we're going to find out whereas actually they said you know the things you love most about this country so the NHS and you know front line care workers Bins, libraries yeah yeah these things are all pay for

the public playgrounds schools education teachers all these things that we We love potholes and we need more of them But if everyone wrote a list of their things they like most about, you know, living in Britain or living in a Western democracy. All those things, healthcare, etc., would be quite high. And they're all paid for by tax. But we still have this slightly odd.

I remember, like, when Jimmy Carr got done and it was all in the press. There was this weird attitude of, oh, good for him. Getting one over. I was amazed by how many people took that thing. Like, well, so what if he fiddled a few quid? It's almost like a game, or it's a battle between you and, in verticomers, the tax man. Whereas I've never seen it like that.

It's more like, you know, I'm funding what's good about this country. And, hey, I may well disagree with sometimes how that money is spent, regardless of your, like, political colours. You may think, I don't want, and this is why you have elections. So it's sort of, you know. You're completely right that, like, it just needs a rebrand and a rethink about how we approach tax, that it's not this, like, Robin Hood, you know, you have to pay your taxes.

and oh, Robbins heard the good guy and he's thieving, you know? The language and the way that when you try and, like, do your tax return, it almost feels like you're being shut out and you're being excluded if you can't speak in all of that jargon. And to be honest, it's not even like a lot of jargon. But when you're like, you know, 25, and you're like, what tax? It's really hard. That's like the part of the problem with being self-employed is no one tells you that though you may be going self-employed for us, specific skill or service that you are an expert in or know a lot about or can generate an

income from, no one tells you that all the other departments of a company that you are also in charge of. So to be honest, HMRC don't really, they understand that you're not an expert, but it's not on them. Yeah, yeah, yeah. And one thing I would say to everyone who's thinking about becoming self-employed or recently self-employed is you, you know, you. you have, the buck will always stop with you on everything, whether it's, you know, your website or your, uh, your taxes or your marketing or transport or whatever it is. And you sort of have to get into your head that though you may be a comedian or an electrician or whatever, you also have to be your PR department, your accountant, all these things. And of course, you can pay other people

with specialities in those areas, but no one cares as much about your business as you do. And it's a bit like, you know, from a comedian's perspective, I've worked with wonderful companies who do great jobs on stuff like tours in Edinburgh, but no one will notice that the phone number for a venue on the poster is wrong, apart from me.

When it gets down to that level of detail, because it matters most to me that the link on the website is not a dead link to an old page. So you have to check all of that stuff. And it's the same with tax, but from what both of you've said, you're saying like it's the most stressful time

of the year or it's, you know, the worst moment of the year for anyone self-employed. Well, the key to changing that is not making it a yearly job because if it's a yearly job, it's almost an impossible job. So... Go on. Tell us, please. Tell us, please. Getting used to updating and maintaining your records every couple of weeks. So like... The amount of sweat coming out with me is quite palpable. Okay, maintaining the records. Half an hour every two weeks is completely manageable, right? Whereas, 24 hours in a day on the 29th of January is not manageable. No one can really, and I know people have done that and it's a nightmare. Whereas... Yeah, you're talking to two of them. Yeah. But there's so many,

so much incredible software now that for a pretty reasonable subscription, and I'm talking like 12, 15 quid a month, you just enter your figures into a website every, every week or two or even every month sometimes. And when you then need to file those returns, I'm not joking, I can file my tax return by clicking three buttons on a website now. And it's done. What website is this that you collect?

Well, there's loads of difference out there's zero. You might have seen adverts for zero or QuickBooks or Sage. So all this stuff, they're all essentially doing the same thing. What they do is they link to your bank accounts. So every transaction comes up and you then apportion it to an expense or an income. And then at the end of the quarter or the end of the month or the end of the year, they basically go, here's you're in, here's you're out. And that's

all taxes. The detail is incredibly complex, but the big picture is very simple. It's what you've earned minus what you've spent. That's it. That really is it. Yeah. So before I was using accounting software, I would basically have two spreadsheets. One was income. So it's every date I did a gig, it would be where that gig was and the fee. And then on another spreadsheet, it would be every time I spent money, it would be what that was spent on. So it would be like food or hotels or train tickets or paper, pens, printing ink and mileage. And so you just have those two spreadsheets. And if you update them every couple of weeks, that's fine. If you update them once a year, it's just too much stress. And essentially what those accounting softwares are, are online.

versions of those two spreadsheets. My accountant keeps saying, you should get QuickBooks, and I haven't. Now I'm thinking about it properly. I'm frightened that I will download it or whatever you do, upload it, load it, and won't, and be like, I can't understand. Just like the HMRC website, I'd be like, I don't understand. And I won't be able to do it, and I feel like an idiot. Is it something that's quite, is it quite user-friendly?

Yes, and the HMRC website, I think, is a crap. It's so bad. Okay. That's like... Nice to hear. It's like 20 years out of date. It's like when you Google something and the link is to a BBC website story

from the early 2000s, you click on it. Like, oh, the text's really, really small in a column and none of the links work and it's got like real media player embedded in it. It's so bad and it's such a shame because it's such an important resource. What I have found with HMRC

is if you have a problem or something you don't understand, it might take you a while to get through to someone, but they are so helpful on the phone. They really are. That's been my experience of being self-employed is if there was what, this is before an accountant,

if there was something I just didn't get, something that wasn't adding up, or something on the website didn't get, getting through to a person, they were brilliant. The accounting software is made by cool, young tech dudes who understand websites. So it's really user-friendly. And it does take, you know,

it takes a few goes to sort of get your head around it. And there's way more information than you'll need. so you can do invoicing through it, you can do all kinds of stuff. But in terms of that basic, in versus out, it's quite simple. And something that will make your tax returns so much easier is using, and you should be doing this, is using a separate bank account and a separate card for business income and expenses and personal income and expenses. Because then, at the end of the year, you've got bank account.

account, which is, you know, Stevie Martin business account. Yes. And it'll say X number of pounds. If everything you spend is on that card. So, for example, yesterday I went into town to do a podcast recording. I used my business card when I tap in and out on the tube. If I was going to meet a friend, I would use my personal card. I'm absolutely devastated that I haven't come to this conclusion myself.

I'm 33 years old and I've been self-employed for nearly like eight years. I cannot stand that, but that's so simple. And I've known for ages that people have separate accounts, but I've always been like, oh, I guess it's some sort of complex thing that they do. But actually, that's like this. It's literally walking into your bank and saying, I need to open up a separate account. And it doesn't have to be a, I don't think it has to be a business account. You can just have a separate current account with a different card. And, you know, if the cards look the same, put a little X with a Sharpie on one or a B, which is what I used to do.

Just put a big B in a Sharpie. This is the business card. Because were HMRC to investigate you, I mean, the idea of handing them a year's bank statement, which is every single transaction, personal and business, and trying to get your head around, which is just to be a complete nightmare. Yeah. You just simply go, here it is. Here's the in.

It comes to X pounds. Here's the out. It comes to X pounds. And that's the same as on my tax return. Oh, that would be so much easier. Yep. Okay, thank you. I think a lot of people get very, and I felt exactly the same.

When you're faced with a skill you don't have, it's really demoralizing. It's really embarrassing. And it takes you back to school. You think, oh, am I so thick that I can't get my head around this? But you need to sort of sit with that feeling and go, right, idiots do this. Idiots do this. A bit like driving. The first time you get at your first driving lesson, you think, how is this so hard?

And then you look up and you think, that person over there driving is thick. I can do it. So I must be able to do it. So you just sort of have to You have to face up to that feeling of inadequacy And go, I'm going to learn how to do this And the first thing I did when I thought I could potentially earn money from stand-up

Was I went to a day-long course on being self-employed It was free. Run by HMRC, they're probably online now. There's loads of stuff on the internet about how to do it But I just went to this day-long, very dry, boring course But it was like, oh, okay, I need, Back then I was doing it on paper Because I'm so old.

But it was right, you need this book for income, this book for expenses, and you fill in them in the sort of slots on the tax return. However, I would also say, as well as having two separate bank accounts and accounting software, the best money you will ever spend is on a good accountant. Yeah, I was really surprised about how, because I always thought that getting an accountant was something that only millionaires did, or even just like rich people who were doing much better than I was. And I got an accountant and I was like maybe 28.

And I wasn't really even earning, you know, particularly good money. And my friend was like, oh yeah, she does the whole thing for like 170 quid. And I was like, yeah, I'll pay that to not have to deal with that. Yeah. And like when it's when it's midday on January the 29th and you just want to die, like how much would you, it's a bit like having toothache. How much would you pay for someone to get rid of a toothache? Well, a thousand pounds, 10,000 pounds, like whatever it costs. Yeah.

So the cost of doing someone doing just your self-assessment return, a decent accountant could be anywhere from like 250 to 400 quid a year, depending on where they're based and how much work it is. And the more work you do, so for example, with QuickBooks or with a really good spreadsheet, the less that will cost because they're obviously billing by the hour. So if you just send them a shoebox of receipts at the end of the year and say sort it out, it could be quite expensive. But if you send them a spreadsheet, which has got, you know, your team, totals of your different expenditures and your income. And that's mirrored by your bank statements. You know, they're literally filling in a form on your behalf, but it's a very stressful form.

So I think 300 quid is more than reasonable for someone to take all of that stress out of your entire year. Yeah. And also if you're listening thinking, oh, I can't afford 300 quid. Like I've said, my woman, my woman does it for like 170. And I have like a spreadsheet, but it's often not added up right and I don't even put, it's only got the stuff going in, it doesn't have anything going out. So she's like, so what I'm saying is if you can, if you ask around, like social media, like there's old fashioned like Facebook or whatever, it's actually quite helpful being like, does any other people who do a similar thing to you? Do they, do you guys have an accountant, who do you have, and of recommendations, you could find somebody surprisingly affordable?

And also a crucial point, a decent accountant will be saving you more than 300 quid by doing your accounts in an orderly way and saying, oh, do you know what? Do you know you can claim for this? Or do you know that you can claim your house as an office? Which is a bit of a minefield, but, because you can't claim as much as you think. It certainly doesn't feel reasonable if you're paying a lot of rent. However, there are amounts you can, if you work from home, you can claim for use of your house as an office. Now, an accountant says that to you and you work out, you can claim 30 or 40 quid a month. Over the course of the year, that could be 400 quid. So the cost of that accountant, they've already sort of doubled their value. And also, the cost of the

accountant is tax deductible. And if you're registered a VAT, you'll take the VAT off it. So, if you're paying 300 quid, including VAT, for someone to do your self-assessment return, then that's probably about 200 quid after tax and VAT are taken off that as an expense. My God. Well, let's get one. We all got to get one. The main mistake that I know people make is mixing up what is an expense and what is not an expense. That's my downfall. That's my downfall. people going, oh, I went out for dinner and my friend was there and he's in the same industry. So I'll put that down as a business expense because we talked about my new project for half an hour. That's not a business expense.

And the key term is wholly and exclusively. So is the thing that you're paying for or buying, is it wholly and exclusively a cost incurred by you doing your business? So a good example is a laptop. Say you're a graphic designer and you need the new MacBook, you know, or you need a faster, that's not, you're not taking the piss. You may need a two or three thousand pound computer or laptop. However, if you're watching Netflix on it in the evening and you're, you know, doing personal stuff on it as your personal email accounts on there, then that laptop is not wholly and exclusively for the business. So you have to sort of make a reasonable case. You know, if you take your personal stuff on it, as you're personal email accounts on there, then that laptop is not wholly and exclusively for the business. So you have to sort of make a reasonable case. You know, if you take your, you know, if you take your work laptop home with you out of the office at the end of the day and then it becomes your personal laptop then that's not wholly and exclusively the cost but you could say well do you know what I work eight in the morning till sort of five or whatever and I might do half an hour's work when I get home and then I might watch something on the laptop for an hour or two then you could probably argue I'm putting this figure out of the top of my head that 75% of the cost is that is for business but I think

that's what in an investigation they want to see that you have have taken that into consideration. And an accountant, I suppose, does that automatically for you? Or just does the thinking, because I think it's that sort of grey, it's the greyness of it. Like just now I'm looking at like our nice podcast mics that we're definitely wholly and exclusively, there's nothing else really I could do with this. But my headphones, I, which I also do needs to do the podcast, I also use those day to day as my headphones.

And so this wholly and exclusively thing, because normally I would have been like, this is part of, these are all my business equipment that I need to do my job, but do you also do something else with them? Like a costume for the stage or like something. If you also wear it in your day-to-day life,

then it's not wholly and exclusively anymore, is it? Clothing is a really interesting one, and I think that's one that a lot of people mess up on because you really aren't allowed to claim for clothing unless it is extraordinary. ordinarily clear that you wouldn't wear it off stage. Okay. Like a clown outfit.

Yeah, like a clown outfit. Like a sort of an insane sparkly ball gown you might wear for a sketch on a, or in a play or something that's clearly. Whereas, say I went to a record something and it was going to be put on TV and I'd fucked up and brought a t-shirt that had a big logo on and they said you can't wear that. And I ran to H&M just to get a shirt. I wouldn't personally claim the cost of that because I'm going to wear that once on that record. And then I might wear it, you know, for the next couple of years on and off. So that wouldn't be reasonable. However, if your headphones broke before this podcast recording and there was no way of you recording it without some headphones

and you had to run or get an Amazon delivery for tomorrow for some headphones, you could potentially make the case that that purchase was wholly and exclusively in order to do your work. I think the thing to realize is it's about what's, it's about being reasonable. I think also were you to get investigated, you can engage with these people. They are people. They understand that tax, and I know people have had horrific experiences with, with investigations. I know people who have had great experiences. Usually the people have had horrific experiences are the ones who are quite combative and who are actually trying to hide their behavior and have actually fiddled. And I,

I spoke to someone who is a tax investigator and they said sometimes they'll turn up to a business and the person will just not speak. They just will not speak or they'll push in a sack truck with three filing cabinets just stuffed with paperwork and say, there you go, there's the last 10 years, sort of out. To sort of think that they'll go, well, it's going to take 200 hours to go through this stuff. It's not worth our time to do it. But if you say to them, hey, nice to meet you, a bit nervous, but I've got to be. got all the stuff on my computer and we can call my account if needs be and sort of take things as they come and they may they may say you know worst case scenario they say i'm sorry um tessabia you can't you can't claim for those headphones worst case scenario sorry i'm ever so sorry it's

going to be an extra what 15 quid you owe them in tax yeah they're not going to go and now you're going to prison okay there's a 10 000 pound fine do i thought are you sure i don't owe a fine for saying they about the headphones? If they went through your accounts and it was clear that you were using company money for personal expenses to an extraordinary degree, or you were, for example, getting checks or money paid to your partner or a member of your family who then transfers it to your personal account, which is a fiddle some people do, then they're going to...

I'm not clever enough to do this. I'm not clever enough to do these fiddles. I'm really annoyed. But you get caught doing the fiddles. But it just goes back to, I don't see what the point is in going to all that stress of living your life thinking, oh God, if I get investigated, I'm done. For the sake of saving a few grand that goes towards good things. And that's not just me saying it now when I'm more successful than I was. When I first started out, the first tax return I ever did, my gross income was one.

thousand two hundred pounds for the year. And, you know, I'd probably done about eight thousand miles. So I made a loss of thousands of pounds. But getting that right meant that in years to come, I wasn't stressed out about these things because I tried to get my head around it earlier. This should be the advime. They should just play this verbatim. You should just go on the telly. I have dropped enough hints that I would be willing to be employed to present HMRC's rebranding. Rebranded. Be the face of tax.

The acceptable, knowledgeable, normal face of tax for a fee, which I would declare. But they've never made the call. I have had an offer to shadow a forensic accountant. I would love to be a forensic accountant. I lived with a forensic accountant. Oh, my God. The forensic accountant is basically these are the men and women who go after the real evaders. And I totally get people saying, well, Amazon, Google, don't pay their tax. I totally

understand that. That's a real inequality in our tax system. However, the idea of driving down a private gated community, thinking, now, this guy is registered as a director of a fish and ship shop, and he's declaring 50 grand profit a year. Yet he's driving a Rangerover of Oak, and he has an and Martin Vantage in the garage. This is an eight-bedroom house. He goes on holiday four times a year. Where's this money coming from? Yes.

And then you start that's forensic accountancy. The adrenaline. How are you going to find out where the money is coming from? Because presumably it's in cash. The money's coming from the fish and chip shop. Oh, it is coming from the fish and chips shop. Oh, he's just not declaring enough money. Yeah, he's laundering.

I'm not tiring all fish and chip shop owners with a tax evasion brush, But you know when you go into any shop and they say, oh, a card machine's broken, just just cash. And you go back two months later and it's like card machine's broken, it's just cash. You think if I was running a business and my card machine broke, that would be like high priority. And they give you this receipt, which is like one of those old-fashioned. It just says six pounds on the receipt.

And you think that till roll's going nowhere. No one's keeping that and tallying that up at the end of the day. But what I do find interesting in terms of the perspective is I can imagine it's very easy to do that, not the money laundering thing, the fraud thing, the tax evasion thing. On a smaller level when you're like, well, Amazon and Google aren't paying their tax. Totally. It comes down to like that thing of does my vote make a difference? Yeah. So on the grand scheme of things, my vote probably doesn't make a difference.

But times me by a million people and that vote decides it's a fact. the future of a government. I guess it just depends on your attitude to stuff like that. If you're listening and you're laundering or you're frauding, you've just got to get a better attitude, mate. But also, when I first started under Gordon Brown as Chancellor, I got working tax credits. And they made the difference.

I would not be doing this career now. I just wouldn't have been able to afford it if I hadn't got working tax credits. What are they? So working tax credits, you don't get them anymore. But basically, if you worked a certain, amount of hours and earned under a certain amount of money. So, for example, I drive to Newcastle from Bristol to do an open spot at a comedy night

and I get paid nothing and it's cost me 100 quid in petrol and a hotel or whatever. I can say, you know, I've worked 40 hours this week and I've earned 150 quid. The government would pay you. They would support the fact that you were, yeah. That's so nice. I used to get, I can't remember how much exactly because it was all tiered. Bring the Labour government back. But it was probably five or six hundred quid a month, which was my rent.

So once you've used that system, well, not used it, once you've made use of that system, to then go, right, I'm now not giving the HMRC a penny, I'm not giving the government a penny, would be so disingenuous because they have enabled me to do the job I want to do. Now, that's not to say that under different governments, that's situation, might not be the case and you might think, well, while they're cutting this, that and the other, and they're not giving support to people. But that's quite a hard argument to make after furlough.

I think I was going to say that, yeah. Hey, everyone, or pretty much everyone. One area where I think there's a real problem is, and this was because of the credit crunch, but self-employed people applying for mortgages, it is an absolute nightmare. It is a complete nightmare. they used to let you self-certificate.

They used to let you tell them what you earned and they'd say, okay, fair enough, yep. So there's all these people who bought houses in like the 80s and 90s like, yeah, I was pretty amazed I managed to afford this house. But the thing is, they do afford those houses. They can pay, it's that ridiculous situation where, you know, I could,

I know friends who could prove and get rent a property for two grand a month in London. but they would not be able to get a mortgage for 500 quid a month. It's kind of insane. Anybody self-employees in exactly that position. And especially when the rent is so high, it's so disgusting to be like, but I want to pay you less than this.

And then what they say is, and this is pre-pandemic, people are like, well, if you're not on a salary, you know, you might lose your job at any time. And then, like, lo and behold, it's like people on salaries were getting kicked. You know, like nothing is stable. If you think you can do it, you should be trustworthy.

to be like, yep, I think I can do it. And if I can't, you take my house and that should just be the that should be the game. Like, if you think you can, here you go. Have a, have a bloody go. You know, like that should be rather than trying to. And also, there are people for whom the system doesn't work and they do fall through the cracks and the legislation or the small print doesn't include them. And that's incredibly stressful, whether it's tax or mortgages or benefits or whatever are just awful, awful. But stuff with like tax loopholes, they don't exist until someone invents them or finds them.

You know, the government aren't creating tax legislation to allow very rich people to find ways around it. They're creating some of the most complex legislation in the world. And if you've got enough money and your accountant's got enough time, you can say, you know, I'm paying my account, my team of accountants, a million, 10 million a year or whatever, and they will find something that HMRC didn't even know exists, which they then have to re-legislate to close it down. So it's not that sort of the system is designed necessarily to benefit very wealthy big companies.

It's just that they have the resources, more resources often than HMRC do, to find these inconsistencies. Yeah. And that's the same with like anything. So it's like if you've got enough money, like you can do anything. Yeah. That's just how it's such a,

that's not at all how I had imagined it. And that is such a refreshing way of thinking about it of being like, if you've got the money, anyone can find a loophole in anything. Well, it's when people like say, you know, ex-ce celebrity was following this avoidance scheme. You know, why did they create this scheme? Well, they didn't.

An accountant created that scheme. That's not a scheme as in like, What you think of scheme is. Like a graduate scheme. Yeah. I mean, I could put together, I could, if I researched it long enough or whatever or have the knowledge, I could put together a PDF saying this is the John Robbins tax investment scheme.

And this is a way that you can pay 1% tax and it's perfectly legal. And you go, it doesn't sound particularly legal. Well, technically, if you follow A, B and C and then transfer it to D and transfer it back to E and set up an F to call yourself a G, then yeah, yeah, it's 1% tax. But it's like it's, it is never sort of morally legal, even though if you do A, B, C, D, E, F, G, you might get to a point where it's 1%. Just to clarify for anyone listening to something I struggled with for a long time is that tax avoidance is the schemes and the loopholes and the totally legal but morally bankrupt things. And tax evasion is the, that is illegal morally and legity. Oh, okay.

Yeah, I mean, a debate opens up. Tax avoidance isn't always morally bankrupt. Oh, please. Because tax avoidance and tax efficiency are sort of, there is a Venn diagram where a lot of that is shared land, I guess. For example, if my accountant said there's really good tax breaks for electric vehicles, for example, say I had a company car. And he said if electric vehicles get a really big tax break, or there's another thing, I can't remember. and what they're called. I was talking about them yesterday. There's these certain investment funds which deal in small UK companies. And because they're small UK companies, the government

gives you a tax break if you invest in them for a certain amount of time. And VCCs, I think, or VCTs, it might be, venture capital trusts, might be, which sounds sort of terrible and horrible, but it's an investment vehicle whereby there's 100 UK startups. And instead of you put your money in the stock market or shares or whatever, you give it to these venture capital people who put it in a fund that support new businesses and startups. And because that is sort of an injection into the economy, the government say there's a 30% tax break on that investment. In a sense, you could say, well, that's avoiding tax, because if I put this, money in another place, I'd be paying more tax. But it's not. It's sort of tax efficient and it's

something the government are encouraging people to do with an electric car. That's obviously a huge benefit to the environment. So it's good that you're saving money by having electric car as opposed to a more polluting car. So tax efficiency is not a bad thing. Tax efficiency is a good thing. And everyone should be, you know, the more knowledge you have about your accounting, the more tax efficient you become. So, you know, the government changes. the amount you can claim per mile by 5p a mile a couple of years ago because petrol prices were so high. Like being aware of that is tax efficient. There was a podcast, Moneybox podcast, which is basically like this, but every week it's all what's new in tax. You know,

you can get a tax break if you insulate your house or we're having a phone in on corporate finance or whatever. But every week there'd be something about being self-employed and they would have a self-employed Q&A where listeners could send in questions for their panel. And there was always something I took away and just sort of filed away. It's like, oh, okay, I need to do that or, oh, I shouldn't do this. So finding a way of ingesting the information in a way that isn't just like, God, I've got to read the financial times every day. I didn't even know if they have tax stories. But yes, that's such a nice way of looking at it. I think it's so funny to me listening to a podcast where they say, like, what's new with tax.

But like, that would be really helpful. That's the thing we, if we're all just bearing our head in the sand, imagine if we all are like, okay, interesting. Yeah. This is, this, I suddenly have the lingo.

And even you're just being like, tax efficiency, tax avoidance, tax evasion, rather than for us, I think at the beginning of this podcast, we'd have been like, I don't know which one is the crime. And like, I still make the odd mistake or,

you know, the odd prete receipt, they put in the bag, and then you finish your sandwich and you chuck the bag away and I don't have the receipt. No one is perfect at this. You know, or I use the wrong card. I was out at someone's birthday the other night,

and, you know, we were having a few drinks. And I realized when I then logged into my accounting software next week, I think, shit, I spent like 50 quid on booze with my business card. But you can rectify those mistakes. Yeah. So you just sort of transfer the money and say wrong card. No one is going to, no tax inspector is going to come to your house and say, excuse me, at quarter past 11 on the 4th of December, 2021, you purchased eight pints with your business card, you're going to hell. Yeah.

You'll be like, yep, I know. And as soon as I could, I rectified it. I transferred this money across or I, I don't know, put it down as a loan or a mistake or whatever. But I've sort of rebalance the figures. So it's all kind of malleable. That's the, that's the biggest take. that I'm taking home from this is the two separate accounts thing, because I genuinely didn't think you actually could do that.

For some reason, I don't know why. So that's going to be my personal, like, New Year's resolution, on top of my go to Bristol for a week, which we talked about a few weeks ago. That's my year's resolution. It's going to be have two accounts, definitely. Tax efficiency, just get efficient and learn some of the words. And be like, oh, here's a whole world that's like open to you, when you doesn't have to cause a nosebleed,

it doesn't have to make you feel like you can only be in that door if you could have been to Mensa. Have, if Mensa replace? You've been to Men's a holiday to Mensa. It does feel like that. Yeah. Yeah. And that's where the accountant's pilgrimage every year.

And if you think, you know, the combined cost of an accountant for a self-assessment tax return and accounting software might be 250 quid a year all in. I mean, 20 quid a month? Yeah. for neatness. Oh,

don't mind that. Yes, please. We haven't even started on VAT to do a separate one. Come on, come back next week for VAT. Part two. Next year. We'll do like a yearly John Robbins tax thing. Yeah, come and, yeah, come on.

Do you want to do a whole month series on VAT? Maybe we'll do our own money box. Do you consider doing your own, have you thought about doing it? No, and I must emphasise this at the end, just as I did at the beginning, I'm not qualified in on your own way to be tax advice. We'll get you in back in again.

Podcasts is just going to pivot into tax and, you know, just be money, just better with money. We're not going to come the end, but I'm so sorry to, I cannot leave this without finding out what your adult thing was of the week. We normally do them at the beginning, but we got so deep in, so quick, but I've got to hear it. Well, it's a bit of a sore point, actually,

because as someone who likes to be... Do you bring us home on a downer if you can. As someone who likes to be ahead of the curve, obviously interest rates are looking like they're going to go up either this month. We're recording this in December or not. next month and certainly go up throughout next year. So I thought, okay, I'll do the responsible thing. I'll remortgage because I'm on a tracker. So there's no fixed period I can move any time

I want. So I contacted my mortgage advisor because I'm responsible and I have a good mortgage advisor. And she said, yeah, this is great. Here are all the rates? And I said, fantastic. I'll get the paperwork over to you on Monday. And between last Wednesday and this Monday, the rates have gone up because I was just, I was only one step ahead of the big banks. So if you'd done it the week before, you would have been all right? Yeah, if I'd done it the week before, I'd have saved myself $552 a year. Oh. But, you know, these things are sent to try us.

Yes. The adult thing is that you did it and, like, you gave it a good go. I didn't, I understood half of it. And I think that's really good. Well, it's annoying because I'd actually been thinking about it for like six months. I've been worrying myself into finally doing something about it. But hey, you've just got to take it on the chin. Yeah, it'll happen again.

There'll be another point when the interest rates will change. You said that with such confidence, Stevie, and I was like, no. I started off, and then I was like, I don't know. But maybe it will happen again and you can get in there with your remarketing. Will they come down again or not? No. Sir, King of Money, please, was the answer? We're at historically low interest rates and by historically, you know, since the dawn of interest rates.

So they can't actually go down anymore. They'll go up to try and get inflation under control when that happens. So the current forecast is they might go up to 1% next year. So if you've got a 250 grand mortgage or whatever, that's another 1% is 2.5 grand a year. So there's a lot of money. It's 200 quid a month. That's a lot. So you want to mitigate that by sort of fixing now

whether or not they then go down again on the other side of that. We don't know. But I mean, the era of 5% savings accounts is long gone. Well, I mean, I said it before and I'll say again, entering on a high, guys. Thank you so much, John. That was so helpful. And please do go and watch bad golf with John and Alex Horn

playing bad golf and also fun around it. from around the golf. If you don't, if you don't know what golf is, you'll really enjoy it. And then also the moon under the water podcast, where you talk about your perfect pub with, oh, Robin.

The lovely Robin. It's my hinterland. Go and immerse yourself in John's hinterland. John is famously on Twitter at Nomadic Reverie. And you can follow us at Nobody Panic Pod. And if you have any questions about tax, because we can't answer that. We'll give it a go.

We won't. Any future episodes that you'd like us to tackle or people that you'd like us to have on. Nobody Fanick Podcast at gmail.com. Thank you so much for listening. Go and sort your tax out. You need to start now. Let's do it.

Now. And best wishes. Many thanks. Goodbye. Try not to do any crimes. But if you do, hey, you tried your best. Okay. Great.

And tell you with that. Bye. Bye-bye.