Why it is never too early to prepare your tax return
Top answer: because your ACCOUNTANT will love you
O.K. so maybe that’s MY top answer rather than yours but there is a serious truth wrapped up in the joke. Giving your accountant everything they need as soon as possible after the end of the tax year will mean:
- Your return is at the top of your accountant’s to-do list
- You’ve got time to find any missing paperwork
- You will get your return back faster
- Your accountant will be under less pressure which reduces the risk of mistakes – contrary to popular opinion, accountants are only human and people who work long hours under stressful conditions make mistakes
- There’s time to consider your options where your tax position isn’t clear cut and you’ll be within the HMRC deadlines to make elections
- You’ll know what your tax bill is – including your payments on account
- You’ve got time to work out how to pay it
The last 2 points are where I see most people coming unstuck……
Hopefully you’ve been saving money towards your tax bill. A decent accountant will offer a service that helps you to plan ahead (we do). If not, doing your tax return promptly means you will have enough time to re-allocate funds, tweak your budgeted spend, or even earn more. You may also need a bit of extra time to set up a payment plan with HMRC. If you are paid via PAYE and owe less than £3,000, you can also ask HMRC to take the tax directly from your pay BUT your return must have been filed by 30 December.
Top Tip – filing your tax return early doesn’t change the date your payment is due.
And finally
The closer you get to 31st January, the busier HMRC systems will be. It crashes. Regularly. Hey ho, you say, that’s not my fault. WRONG! HMRC take the view that you have had 9 months to file your return and it’s not their fault you decided to leave it so late. You will not be able to appeal against a late filing penalty if their systems go down. That’s an automatic £100 penalty.
Why not make an appointment to talk to us about how our clients get their tax return checklist on 6 April, an email on 6 May, and a friendly phone call in June. They will have all their paperwork to us by the end of July – how about you? Wouldn’t you like to work to a timetable that sees your return filed MONTHS ahead of the deadline everyone else is working to? If you’d like the feeling of calm and confidence that brings, we’d love to talk to you.