If you’re one of the nation’s millions of small business owners, New Year means only one thing: self-assessment. With the deadline looming for filing, many business owners have a stressful and fraught January as they scrabble to sort out their tax return.
It really doesn’t have to be like that! Self-assessment is a daunting process, but if you follow our four top tips you will have a self-assessment form filed in no time…
1. Register
It’s not physically possible to submit your tax return if you’re not registered with HMRC. If you haven’t done so already, you need to get registered promptly. It can take a couple of weeks for your account’s activation code to arrive, and you don’t want to miss that deadline! HMRC will not give you this information over the phone, it must arrive by post. If you’re late registering, the code will be late arriving and you will be late filing.
That will result in an automatic fine!
When you register you will need to tell HMRC your Unique Tax Reference (UTR). This is the ten digit number on any paperwork that comes to you from HMRC. Make sure you use your UTR, and NOT your National Insurance Number.
2. Collect all your information
There is a lot of information you need before filling in your self-assessment. If you’re unsure what documentation you need to include, use this basic rule of thumb: any money you have earned or received, from any source, including wages, interest, money from trusts, and profits from business conducted as a sole trader, partnership etc.
This will be a hassle to collect if you don’t have a system in place. Make things easier for yourself next year, and start collecting this information as and when it’s generated. You might want to consider getting a bookkeeper, to ensure everything is bang up to date at all times.
3. Stick to the rules
Tax comes with a lot of rules and regulations. Make absolutely certain you follow them, to the letter. Ensure you’re accounting for your income correctly. Learn the rules for expenses and make certain you don’t put things down as business expenses when you can’t claim for them. Another useful rule of thumb: if something is used completely and exclusively for business purposes, you can claim it as an expense. If there is any way you could use it for personal reasons, even if you will be using it for business most of the time, you can’t.
4. Check and correctly submit your forms
Your tax return must be completed and submitted correctly by midnight, January 31st, or HMRC will automatically fine you £100. It doesn’t matter if you’re only a day late, you will still be fined!
The deadline for postal submissions has already passed for this year, meaning you will have to fill in your self-assessment online at HMRC’s website. Make sure you leave plenty of time to check and triple check everything. Even simple mistakes can result in your self-assessment form being rejected. If that happens there will be a penalty.
Do you need help with your taxes? Look no further! Dunkley’s are here to help. Whatever your tax requirements we can help make it a stress-free process that’s perfect every time. Give us a call now on 01454 619900 to have a chat about how we can help you…