Sussex Business Times got into contact with David Sanders, Partner at Sheen Stickland accountants who explains the ways in which you can fully prepare yourself for the January 31st tax return
There is so much preoccupying our minds during January with personal and financial New Year’s Resolutions, so it’s of little surprise that people forget that there is another important date to remember; 31st January – the deadline to file tax returns and for payment of any tax due.
Completing a tax return can seem like a complex task and many people may choose to put it off until the last minute. According to HMRC, over 1.3m returns were submitted in the last three days of January 2016, with the busiest day being the 29th. However, it doesn’t always have to be like that. Below are a few tips and advice that can make the whole process less of a burden at this time of year.
1) Register in time – If you are new to self-assessment then you should have registered with HMRC by 5th October. For future reference, to register then you need to visit www.hmrc.gov.uk.
2) Be organised – We all know that life can be hectic enough without thinking about filing and admin at home. But it can be little things such as filing bank statements away in a folder each month or keeping receipts together in a box that will be beneficial in the long run. With everything in one place, it makes it easier to find it and saves you hunting high and low for a receipt for something you bought a year and a half ago.
3) Make time for your finances – Probably the most daunting task is realising that you suddenly have to collate data from over 12 months ago and turn it into a reliable tax return. However, you can make life a lot easier if throughout the year; you set aside some time each month, even if it’s just one hour, to update your books. If you are a sole trader, it is worth considering an accounting package like Xero that will do the hard work for you.
4) Be prepared for your tax payments – The common situation with last minute tax returns is that people forget that not only is the return due by 31st January but so is their tax liability which can cause unnecessary worry and panic. However, if you do your return early enough, this gives you time to plan your payments and set aside money for your future tax bill. It is also worth mentioning that if your tax bill is over £1,000 then you are required to make payments on account – so be aware that as well as your tax liability, you will need to pay an extra 50% on top of that.
5) Ask for advice – If you are unsure of whether you need to complete a tax return or what should be included, don’t be afraid to ask. There are many complex areas such as capital gains, investments and trading losses that you may not fully understand. Similarly, there may be reliefs available to you that you are not aware of and this is where professional advice is valuable.
Here at Sheen Stickland we have a team of tax experts who are willing to provide advice and discuss your tax return concerns with you. We are also able to prepare and file your tax return on your behalf if required. For more information on self-assessment and filing deadlines, please feel free to contact us on firstname.lastname@example.org