Self-Employed? Get Your Tax Return in Now
Accountants have issued a warning to those obliged to fill in a self-assessment tax return to act now as the deadline (31st January) is fast approaching.
The deadline for filing a paper return has already passed, but those completing tax returns for the 2017-18 tax year online have until the end of January to submit their information.
Almost one in five of us are required to complete a self-assessment tax return, mainly those who are self-employed or have multiple income sources.
The 31st of January deadline may be a couple of weeks off still, but those filing for the first time are reminded that they need to get moving earlier as they will require a taxpayer reference which is still sent via post and not online.
HM Revenue and Customs (HMRC) sends copies of the reference (or any activation codes required) by post to those who haven’t filed with them before or those who have misplaced their details.
The slightly cumbersome aspect of the process is part of a bid to fight fraud, and has been received well by accountants. The head of taxation at the Association of Chartered Certified Accountants (ACCA), Chas Roy-Chowdhury remarked that the system has been an effective way to fight fraud, but does require many people to take action well in advance of the deadlines.
If you don’t get your self-assessment tax return to HMRC by the deadline you could face a £100 fine for filing it late. This applies to all late filings up to three months after the deadline. After three months, you’ll be penalised at a rate of £10 per day, all the way up to a maximum of £900 - with further penalties at the six and twelve month marks after the date of the deadline.
Last year, as many as 2.1 million people filed their self-assessment return in the last four weeks before the deadline according to Tilney, the financial planning and investment firm.
Jason Hollands, the managing director, advised people not to delay submitting their tax return until the last minute in order to avoid a stressful situation, especially given that most of us aren’t meticulous record-keepers:
"It is all too easy to put off things that most of us regard as tedious until the 11th hour, but leaving your tax return to the very last minute can be both stressful and risky. It can be stressful because filing a return can involve quite a bit of preparation and not everyone is great at orderly record-keeping. They may need to track down their taxpayer reference, payslips and annual P60 statement, check bank accounts for interest and dig out details of any share dividends and tax credits received."
Quick tips for filling in your tax return
- Check your personal details - inform HMRC of any changes (e.g. your address, your name, etc.)
- Fill in the sections that apply to you - the system is responsive, so sections will be removed as you go along if information you entered makes later sections irrelevant
- Report what you’ve earned - don’t forget to include additional income (e.g. property income or income from investments)
- Add your tax-deductible expenses - use your receipts when filling this in
- Double check your return - it is still possible to change your return after filing, but still check it thoroughly before you submit it