Get your Tax Return done early!
Are you putting off filing your tax return? Are you one to put it off until next year, given the deadline is 31st January 2023? Getting your tax return submitted early could attract several benefits.
Let’s take a look at eight reasons why we think getting your tax return prepared and submitted early is beneficial.
Know your liability-Filing your tax return early will ensure you know your tax liability earlier, claim all allowable tax reliefs as early as possible and avoid last minute panic.
Receive a repayment sooner– You are entitled to a refund from HMRC if you have overpaid tax during the year. If you have overpaid tax, it is advisable to complete your tax return as soon as possible, so that you can claim this refund. This could improve your cashflow.
More time for tax planning– Preparing your return early enables you to consider any tax planning opportunities, allowing you to implement them in time for the following tax year.
Do you owe less than £3000 in tax? there is an option to have this tax collected through an adjustment to your tax code. This means any tax owing would be collected from your monthly salary over 12 months. This is effectively an interest free loan from HMRC. However, you must file your tax return before 31 December and elect to pay this way.
Avoid late penalties– Filing early will give you time to address any problems and avoid HMRC’s late filling penalties. If you miss the January 31st deadline, you will incur a £100 penalty.
Need to contact HMRC– If you have attempted to get in touch with HMRC’s personal tax helplines in January, you will most likely know their hold music by heart.
With increasing pressure on already stretched resources due to the coronavirus pandemic, and new customs requirements due to Brexit, it is all set to get even worse.
According to HMRC’s own data released last year, the average wait time for callers had risen to almost 14 minutes, and 49.2% of callers had to wait for more than 10 minutes to be answered. Filing early will mean avoiding this.
Avoid stress and Minimise Mistakes– HMRC says that 26,562 people filed their tax return between 11pm and 11:59pm on the January 2021 deadline.
While leaving it late might be unavoidable for some, it does carry the risk of making more errors than necessary, and mistakes can lead to fines. HMRC charge 0 to 30% of the tax due if people have been careless.
Also leaving filing until the last minute could mean not being able to get important information, such as dividend certificates and bank interest details, before the deadline.
Gives you more time to research Professional advice– You can include the costs of hiring a professional accountant or adviser as a tax-deductible expense. It gives you more time to find the right professional to help you out. It’s important to do your research and make sure you find someone with a great reputation, as bad advice can cost you time and money.
Their advice can help you set up a proper record-keeping system, also, their knowledge of tax and expenses could go towards reducing your overall tax liability.
For a free no obligation meeting click here: http://integrityaccountancy.com/contact-us