October 23rd, 2014
Six great reasons why you must submit your tax return early
Doing your tax return is the perfect job to put off to tomorrow. Nobody likes wading through paperwork and working out what goes in what box, what’s taxable – and what’s not (ok – we do).
There are some great reasons though for getting your return done early. Here’s six of them.
Cash Flow
If you’re due a tax refund then HMRC will pay it to you as soon as they’ve processed your return. But, if you owe them money the payment date is still 31 January. Win-win!
Nasty Surprises
The payment on account system can sometimes throw up some unexpectedly large tax bills. If you have a larger tax bill than you were expecting then an extra few months to sort yourself out could help save you a 5% surcharge due on tax still owed by 28 February.
Paper returns
Some people prefer to submit things on paper – especially if they have concerns over confidentiality or even a missing reference that could cause an electronic return to be rejected. You can submit a paper return by 31 October. After that you need to file electronically or, if you submit a paper return after 31 October you’ll have to pay a penalty.
Accountants
The run up to 31 January is the busiest time for accountants and many firms charge a premium rate for tax returns that have been left to the last minute. Some firms can be so busy that they simply won’t be able to help you in January.
Paying tax through PAYE
If you’ve submitted your return by 30 December and owe up to £3,000 then you can opt to have it collected through PAYE – giving you much more time to pay.
Just Do It!
If you’ve got a tax return to do then it’s not going to go away. Even if you don’t see why you’ve been sent one you can’t just ignore it. The penalties for submitting a tax return late are eye watering and it’s easy to rack up fines of more than £1,200 if your return is late by more than six months. And nowadays you can’t get the fine reduced to the amount of tax you owe.
Jonathan Ford & Co advise a wide range of individuals owner managed businesses on how to legitimately manage their tax affairs. For a free consultation call 0151 426 4512 or email info@jonathanford.co.uk
