With only five days to go until the deadline closes for self assessment tax returns, you may be getting a little anxious about whether you’ll be able to actually complete everything on time.
Here, Emily Coltman FCA, Chief Accountant to FreeAgent - who provide multi-award winning cloud accounting software for freelancers, micro-businesses and their accountants - gives her top tips for completing Self Assessment at the last minute.
Emily said of the entire self assessment process: “Completing a tax return can be a stressful process but don’t let it overwhelm you. Make use of the available tools and useful information, follow the rules and if, you get too stuck, don’t forget that you can always ask a friendly accountant for help.”
Emily Coltman’s Top Five Tips
1. Act quickly
“Before you can submit your Self Assessment tax return you must first register with HMRC and get your unique activation code sent to you by post. You simply cannot file your return without this. It’s a relatively straightforward process but, as you’re relying on snail mail to get your code, it can take a while to receive the information you need. And if you leave it too late, you won’t get your code in time to be able to meet the 31st January deadline.”
2. Include all your information
“You have to include any money you’ve received, or earned, from pretty much anywhere, in your self assessment tax return. This includes the P60 form your employer gives you, showing your salary and tax for the year to 5th April 2016, and also if you have a non-ISA bank account that pays you interest, if you’re a sole trader, or in partnership, and if have received dividends on shares you own, whether these are in your own company or another.”
3. Follow the rules
“There’s a huge number of different regulations that small business owners have to follow when it comes to tax, so make sure you are aware of these. Make sure that you know the rules surrounding specific business expenses and what you can (and can’t) claim. Check your proposed expenses against the information on HMRC’s website, or use another reputable source of expenses information for sole traders, partnerships and limited companies.”
4. Check your forms before submitting them
“Remember that a single, simple mistake or omission, such as not ticking the confirmation box at the end, could potentially result in your tax return being rejected by HMRC and you being fined. If you don’t feel one hundred percent confident in submitting your tax return, it may be a good idea to speak to a qualified accountant who can review it for errors. Just bear in mind that it’s likely to be quite expensive to hire an accountant at this very late stage too.”
5. Late filing isn’t the end of the world
“Don’t do a poor, rush job just to get it submitted. If you miss the deadline, the worst that can happen in the first instance is that HMRC will fine you £100 for failing to file on time and you’ll be charged interest for paying your tax late - the tax inspectors won’t be immediately knocking at your door, you can still submit your tax return after the deadline has passed. However, dawdle too long and HMRC starts increasing the penalties which will quickly start to add up!”