Did you know that you don’t have to wait until the last minute to file both your self-assessment and corporation tax returns? And that even if you do file early, any payments still won’t be payable until the normal due dates?
We know most of you will be too busy running your business to worry about doing your tax returns early, but you may be surprised to know that there are a number of benefits of getting everything done and dusted well in advance of the deadline.
So, stop thinking about it as a last minute chore and take a look at the 3 top reasons why you should get everything done early.
1. Time to resolve queries
How many times have you looked at your bank statement and being completely flummoxed by an entry? Don’t worry – you won’t be the only one! Although, it’s easy to think you’ve got a handle on every item of income and expenditure, with everything else going on (running a business, day to day living, Netflix!), it can be tricky to remember every last detail.
Submit your returns early and you give yourself (and your accountant) valuable time to look into any untoward bank statement entries. It also allows time to discuss any changes in your personal or business circumstances that may have an impact on your returns. Leave it to the last minute, and you might simply run out of time.
2. Ensures nothing is missed
Like everything – if you give yourself plenty of time, then the chances are you won’t rush, miss important information or make crucial mistakes. Remember Making Tax Digital means HMRC has digital access to all your records, so they will quickly be able to see if you’ve forgotten to mention selling that holiday home in Sicily!
And the longer you leave filing your self-assessment or corporation tax returns the more likely receipts and invoices will be overlooked, mislaid or eaten by the dog! We always recommend you get returns done as soon as practically possible, as you’re much less likely to miss something important.
3. Helps you effectively manage your cashflow
Leave your tax return to the last minute and you could be left in the horrible situation of owing more than you expected and not having the funds to do it. And if you’re late paying, then HMRC will charge you interest and possibly late payment penalties as well.
Submitting your tax returns early puts you firmly in control. Not only will you know exactly how much you owe, but you’ll be able to start saving for the bill and manage your cash flow effectively.
And there is another advantage of submitting your returns early. If it turns out you’ve overpaid on tax, HMRC are pretty good at getting that money back to you promptly. So, if you think you have overpaid on tax, get your tax returns in as soon as possible. After all, would you rather the cash was in your bank account or the tax man’s?
What are the tax returns deadlines you need to know about ?
While there isn’t a universal deadline for filing your corporation tax return, as the date will be unique to your company (9 months and 1 day after the end of your company’s financial year end), self-assessment returns are due for everyone by 31st January 2020. So, if you haven’t started pulling together all your information yet, we suggest you get started. Think of it this way – it could mean you (and your accountant) could have a lovely break over Christmas without the shadow of receipts and expenses looming over you.