If you are self-employed or run your own business, the looming deadline of the 31st of January no doubt will be all too familiar to you. Last year, 2700 taxpayers took time out from their Christmas day festivities to go online and file their self-assessment tax return for 2019/20. Despite such diligence, 45% of taxpayers (some 5.4 million) had still to file by the start of January.
This year, SMH Chartered Accountants want to help your self-assessment be as stress-free as possible. Sharon Webb, Director and Member of the Chartered Association of Certified Accountants says “December and January are peak work times for us at SMH, so if it’s your New Year’s resolution to get your tax return filed early this year, or you are just trying to wrap your head around the process I’m pleased to be able to share my top tips with you. Whether you run a million pound business, have a new start-up, or even if you didn’t make any money at all this year – if you are registered self-employed, get that tax return done!”
Here’s what you’ll need:
- Gather your key information. These could include: proof of self-employed income, a P60, a P45, a P11D, information on income earned from rental properties, share dividends, bank and credit card statements, pension records, capital gains.
- Check Casual Income Guidance. If you received any casual income, new interactive guidance is available to check whether the income has to be declared. This might include: selling things, maybe online, or at car boot sales and auctions; doing casual work, such as gardening, food delivery or babysitting; charging for the use of equipment and tools; and renting out property or part of your home.
- Don’t forget expenses. For employees and directors, make sure you claim tax relief for any job-related expenses which your employer has not reimbursed. With professional fees or subscriptions, remember to include the amount paid during 2020/21, as these usually increase annually. Where your own car, motorcycle or bicycle is used for work, a deduction can be claimed based on HMRC approved mileage rates. Remember that travel to and from work only counts if it’s to temporary workplaces.
- Government Gateway. To file online through HMRC’s digital portal, you’ll need your 12-digit Government Gateway ID, activation PIN and unique tax reference (UTR). Remember that filing early could save you some stress, since HMRC’s online service can get busy at the end of January, and there is a £100 penalty if you file even a day late (without reasonable excuse).
So, have you filed your self assessment yet?
With around 45% of self-assessment payers still to file their returns by the start of January, rushing can introduce mistakes. If you aren’t confident with the numbers, SMH Chartered Accountants can help take the stress out of completing your tax return, ensuring every box is completed correctly and you take advantage of all the allowances available against your tax. They will also file your tax return and deal with HMRC if needed on your behalf.
