Ever filed your Self Assessment and found yourself staring at a number that's much higher than you expected? You're not alone — and in this episode, Annie explains exactly why that happens.

The short answer: your tax bill isn't one bill. It's two. And if you don't know about the second one, it can feel like a real shock.

In this episode, Annie covers:

When your first tax bill actually arrives — especially if you're newer to self-employment. The tax year runs April to April, and your first return isn't due until the January after that year ends. If you started your business in autumn 2026, your first deadline is January 2028, not January 2027.

National Insurance for sole traders — how Class 2 and Class 4 NI work, why they show up inside your Self Assessment total rather than separately, and why it matters for your State Pension.

Payments on account — what they are, when they kick in (when your Self Assessment bill exceeds £1,000), how they're calculated, and why the first time you encounter them can feel like a double hit. Plus: why they're not extra tax, and how the rhythm evens out over time.

How to prepare — including setting aside 20–30% of income throughout the year, and when it's legitimate to apply to reduce your payments on account.

This is the final episode in the April finance series. If you've been listening along, you now have a solid grounding in expenses, record-keeping, tax changes, and what your Self Assessment bill actually looks like. Well done for showing up for your business finances.

Want to go deeper? The Home Baking Business Academy has a full financial programme this April covering everything discussed across episodes 18–21 — in the practical detail that's actually relevant to running a baking business from home.

https://anniebennett.co.uk/the-home-baking-business-academy/

For regular delves into baking business matters, including taking part in podcast episodes:

https://anniebennett.co.uk/#subscribe

For free tips, insight and real-world business talk:
Follow me on social media

https://www.instagram.com/thehomebakingbusinessacademy/

https://www.facebook.com/thehomebakingbusinessacademy

https://www.tiktok.com/@hbbacademy

https://www.linkedin.com/in/annie-bennett-hbba/

For her website with all this and more:

anniebennett.co.uk

Please note: this episode covers general information for sole traders in the UK and is not financial or tax advice. If you're unsure about your specific circumstances, speak to a qualified accountant or tax adviser.

In episode 20, Annie talks about what HMRC actually expects from you as a sole trader when it comes to record-keeping.

Because most bakers have a vague sense they should be keeping records without really knowing what that means in practice — or quite how long they need to keep them.

The episode covers:

• What HMRC requires (and what it doesn't)
• The five-year rule and why it matters more than most people realise
• What counts as a record for both income and expenses
• Five questions to honestly assess whether your current system actually works
• Why the bakers with the least financial stress aren't the most organised — they're the most consistent

This isn't about having a perfect system. It's about having one that exists and works for your real life.

Want to go deeper?

April is finance month inside the Home Baking Business Academy. We're covering record-keeping and expenses, tax changes and MTD in practice, National Insurance and payments on account, and a full step-by-step Self Assessment walkthrough — designed specifically for home bakers, in plain language.
Join The Home Baking Business Academy Membership

https://anniebennett.co.uk/the-home-baking-business-academy/

The start up guide which includes the finances guide:

https://anniebennett.co.uk/#subscribe

For free tips, insight and real-world business talk:
Follow me on social media

https://www.instagram.com/thehomebakingbusinessacademy/

https://www.facebook.com/thehomebakingbusinessacademy

https://www.tiktok.com/@hbbacademy

https://www.linkedin.com/in/annie-bennett-hbba/

For her website with all this and more:

anniebennett.co.uk

If you've been anywhere near a small business forum or Facebook group recently, you've probably come across a lot of noise about MTD and the trading allowance, and possibly come away feeling like everything is about to change and you're already behind.

In this episode, Annie cut’s through that noise to give you a calm, clear picture of what's actually happening, when it's happening, and most importantly, whether any of it changes anything for you right now.

Because for most home bakers, the urgent action list is a lot shorter than the headlines suggest.

In this episode:

• What Making Tax Digital (MTD) actually is and how it's being phased in
• The income thresholds: who MTD applies to and when (April 2026, 2027, and 2028)
• What quarterly submissions actually look like in practice
• The trading allowance vs the Self Assessment threshold — and why they're being confused
• Why the "£3,000 tax-free" idea isn't quite right
• Three questions to ask yourself to work out where you stand right now
• Why building digital record-keeping habits now is worth doing regardless of MTD

Want to go deeper?

April is finance month inside the Home Baking Business Academy. We're covering record-keeping and expenses, tax changes and MTD in practice, National Insurance and payments on account, and a full step-by-step Self Assessment walkthrough — designed specifically for home bakers, in plain language.
Join The Home Baking Business Academy Membership

https://anniebennett.co.uk/the-home-baking-business-academy/

The start up guide which includes the finances guide:

https://anniebennett.co.uk/#subscribe

Glossary:

HMRC: His Majesty's Revenue and Customs

GROSS INCOME Your total income before anything is deducted. For a home baking business, this is everything you've been paid for your orders, before you subtract any expenses or tax.

NET INCOME (also called PROFIT) What's left after your allowable business expenses have been deducted from your gross income. This is the figure HMRC uses to calculate your tax bill — not your gross.

MTD: Making Tax Digital

For free tips, insight and real-world business talk:
Follow me on social media

https://www.instagram.com/thehomebakingbusinessacademy/

https://www.facebook.com/thehomebakingbusinessacademy

https://www.tiktok.com/@hbbacademy

https://www.linkedin.com/in/annie-bennett-hbba/

For her website with all this and more:

anniebennett.co.uk