Almost as certain as the enduring requirement to pay taxes is the inevitability that multitudes will leave it until the last minute to file their tax returns.
The deadline of midnight on 31 January 2022 is for submitting your online tax return and paying your tax bill for the tax year ending on 5 April 2021.
We understand the reasons why you might delay collating the information for your tax return. Even with most information online, you may find it quite a tiresome task.
And some people stick their head in the sand because they’re worried about how much tax they will have to pay. You might just have a lot going on in your life – and let’s be honest, your tax return probably isn’t the first thing on your priority list.
Although we understand this, you probably don’t need us to tell you that HMRC are not so sympathetic. Late filings mean penalties and interest payments, as well as all the tax owed.
So with that in mind, let’s focus on the positives of acting sooner rather than later.
Peace of mind
There’s nothing quite like facing a challenge head on. And in the case of your tax return, the large tax bill you might be fearing could end up reduced after the right allowances have been applied.
Far better to find this out months earlier and stop worrying, rather than carry the anxiety with you until January. And even if the bill is hefty, at least once you know the exact figure you will be able to get a plan in place to pay it.
Of course, when any job is ticked off your list it comes with a certain satisfaction. One less thing to do!
The time to do a good job
When anything has to be rushed, there is greater potential for errors to be made. By acting early, you take the pressure off. There is more time to ask questions if you (or we) need to clarify anything, and more opportunity to correct mistakes.
Something to watch out for in particular this year is if you claimed any COVID-19 emergency support between April 2020 and April 2021.
Any grants relating to the self-employment income support scheme (SEISS) and small business grant fund (SBGF), are subject to income tax and self-employed national insurance.
This is declared and paid via your tax return.
Dodge the added extras
If you have got a tax bill to pay, that’s one thing. But don’t expose yourself to the risk of paying extra through fines and interest payments.
If you miss the submission deadline these are likely to come into effect. However, they will also apply if you make the submission but your payment isn’t processed in time.
While most payment methods are completed on the day they’re made, BACS payment, cheques and direct debits can take three days to process. If you are setting up a direct debit with HMRC for the first time, it can take five days for it to clear.
The penalty for being late starts at £100, and you’ll also have to pay interest on your tax bill on top of this. We’re sure you can think of better ways to spend that money, given the choice.
With so much to gain, let us help you submit an accurate tax return early.
Give us a call to get started.