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The benefits of filing your tax return today
The deadline for tax returns is 31st January. It's important to file yours early for various reasons.
The one good thing about the tax return deadline is that it always remains the same – 31st January. This means that with a little bit of organisation and the help of your accountant, you should be able to avoid facing penalties by maintaining easily accessible and up-to-date records of your income and expenses throughout the year.
The better your record keeping, the easier it will be for your tax return to be completed accurately and well before the deadline.
We explain why you shouldn’t delay in filing your self-assessment tax return.
You don't have to pay your tax bill early
Calculating your tax liabilities and filing your return now will allow you time to start budgeting and managing your cashflow ready to make your tax payment. You can plan for paying any tax you may owe by the deadline of 31st January. Filing your tax return early doesn't mean you have to pay your tax sooner.
Pay your tax through your tax code
If you owe less than £3,000 in tax and file your tax return before 30th December you may be able to choose to have your tax liability collected through your tax code. This can be a great option to spread the cost and ease the pressure on your cashflow.
Get your tax repayment sooner
Refunds of tax can arise for employees and directors due to issues with tax codes. Also, it is not unusual for building subcontractors operating under the Construction Industry Scheme to receive tax refunds.
Therefore, the earlier you file your tax return, the sooner any refund will be paid to you. Don't wait until January to file your tax return, you'll be waiting longer for your refund and missing out on bank interest while the money sits in your bank account.
Avoid penalties and late filing interest
If you delay in filing your tax return, you risk missing the deadline and face being issued with an automatic £100 filing penalty, no matter how much tax you had outstanding. If your tax return becomes more than three months late, £10 daily penalties will start building up until they hit a £900 peak.
Should your tax return become more than six months late, then a penalty of the higher of £300 or 5% of your tax due will be charged. The same level of penalty is applied again if the return becomes over 12 months late. All of these penalties are in addition to one another, and as a result of this the penalties for a late tax return could hit more than £1,600.
Give yourself plenty of time to prepare your tax return
If your financial affairs changed this year, then putting them in order sooner rather than later will give you the time to think about any tax planning opportunities available to you.
It also allows time for bank statements and any other financial documents you may need to file the return to be collated. Apps like Dext make it much easier to keep track of all those bits of paper that build up over the months. Speeding through your tax return at the last minute increases the risk of mistakes being made. Giving you and your accountant time means your tax return will be correct and complete.
We can help file your tax return
Tax has become an ever-changing and increasingly complex field and unless you have expert knowledge, you may be left bewildered and miss out on all the reliefs you are eligible for. Without the help of an advisor, you could end up paying too much tax without realising, or accidently pay too little and risk an investigation.
So why wait, call us today on 0151 355 5600 or use our simple online enquiry form and beat the deadline, be safe in the knowledge that you can be relaxed about your tax.
Date published 17 Aug 2018 | Last updated 17 Apr 2024
This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.Choose the right accounting firm for you
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