Time flies –  5 reasons you should file your tax return early

 

ivy wood, mums tax break, accountants, accounting, tax return, self assessment, tax return help, bookkeeper

Can you believe that we are already over 1 month into the start of the new 2017/18

tax year? The saying ‘time flies’ has never been truer. Unfortunately, that

means we are also 1 month closer to the filing deadline for our 2016/17 tax returns

and you may have already received your annual reminder from HMRC.

Tax returns dated 06 April 2016 to 05 April 2017 are due for electronic filing no later

than 31 January 2018, the penalty for late submission (up to 3 months) is currently

£100.

We are all tempted to brush our accounts and tax returns to the side whilst we

concentrate on the running of our businesses day to day… after all, it is the easy

option BUT I am sure you can agree there is always that one niggle in the back of

your mind that gets bigger and bigger as we get closer to the 31 January deadline.

Wouldn’t it be lovely to have a stress-free couple of months knowing you are all up

to date?

As a business owner, and it has taken me a long time to realise this myself BUT

sometimes we have to give ourselves a break. Instead of feeling stressed and

anxious for 9 months wondering what your tax return will be, why not do it now and

release yourself of that tension? Your mind will feel much better for it allowing you to

concentrate on more important things like business plans for future growth. I like to

think a clear mind is an exciting mind.

If that doesn’t tempt you here are a few further advantages of filing your tax returns

early

Cashflow –

So you are in a position where you do have a tax liability payable to

HMRC, by preparing and filing your tax returns sooner rather than later you are

giving yourself more time to plan, save and budget your cashflow accordingly (and

no last minute surprises). The payment deadline will remain at 31 January– It will not

trigger an earlier payment date and maybe depending on individual circumstances

you might even be able to have any tax due collected via PAYE through an adjusted

tax code (providing your tax return has been filed by 31 December).

If you are lucky enough to be due a tax refund, the sooner you file the tax return, the

sooner you will receive the amounts due, you do not have to wait until the 31

January before repayments are released. HMRC are fairly reasonable and refunds

tend to get repaid in a matter of weeks upon receipt of the tax return.

 

ivy wood, mums tax break, accountants, accounting, tax return, self assessment, tax return help, bookkeeper

Time –

By preparing and filing your tax return early you are effectively creating

yourself more time to gather all of the necessary information required instead of

rushing around last minute ploughing through draws, cupboards, piles of paper,

carrier bags, etc. There is also less time to lose important documents and forget

what happened that 1 day back in April 2016 that your accountant is now querying

with you.

It will also give your accountant more time to identify and investigate any errors and

or discrepancies within your accounting records.

Tax Credits –

If you are currently in receipt of tax credits your deadline for renewal is

31 July. Although at this date you are able to provide HMRC with estimate figures

wouldn’t it be much more efficient to be able to give them actual figures?

By providing HMRC with actual figures you can ensure you avoid the HUGE

overpayment/underpayment scenario.

It is also worthwhile remembering if you do see a sudden change in your income

throughout the tax year to inform them as this can also have an impact on your

current claim.

HMRC Enquiries –

HMRC currently have 12 months from the date you file your tax

return to raise any queries they may have. The sooner the return is filed, the sooner

this period will close. Which goes back to my initial point, an HMRC return can be straining,

the sooner the 12 month period has passed the sooner your mind can be at ease.

Of course, I’m sure everything will all be OK if you are chosen by HMRC, especially if

you have the helping hand of a reliable accountant.

So what are you waiting for? – Get in touch today to see how we can help you.