While there are many benefits and advantages to being self-employed, many can struggle with completing their self-assessment tax return. The increasing use of the online tool at the HMRC website has helped in terms of cutting down errors, but many people still struggle to complete their tax return online before the deadline.
Despite receiving letters and alerts, people still don’t understand when they have to complete their tax returns or pay their tax. As we’re only a couple of months into a new tax year, we’ve put together the key dates and deadlines you need to know. At the same time, you shouldn’t feel like you need to wait until the deadlines are upon you – complete your tax return or instruct an accountant now in order to get your information processed while it’s still relatively fresh and in your mind.
What are the key dates and deadlines you need to be aware of?
April 5th is the end of the tax year, while April 6th is the beginning of the next tax year.
It should be easy to keep track of your incomings and outgoings for self-assessment, as you don’t have different accounting dates in the same way that a company might trade from January 1st to December 31st, for example.
If you haven’t embraced technology yet and aren’t completing your self-assessment tax return online, this is the deadline for sending in your paper version for the previous tax year.
The only exception to this is if you are planning to send a paper return but only registered for self-assessment after 31st July. In this case, you will be given a deadline three months from the date HMRC first writes to you.
If you do miss the deadline, you have the option of completing an online return instead in order to avoid a penalty, but you will need to register online first.
This is the deadline for completing online returns, and as in the example above the only usual exception is if you have registered for self-assessment in the three-month period up to this date.
If you choose to complete your tax return online, all the calculations are done for you, and you can set up direct debit payments or make electronic payments online, too.
If you use an accountant, don’t feel as if you need to do paper returns. HMRC allows you to authorise a third party to access your online account and complete the tax return on your behalf.
This date is also your deadline for paying any tax outstanding for the previous tax year. In your first year of being registered for self-assessment, you’ll also have to make a payment on account on this date based on the current tax year.
31st July is when you have to make a payment on account for the current tax year. This is usually half of your total tax liability, meaning you pay 50% of your total outstanding tax every six months. HMRC will use your last tax return to calculate your payments on account, and you can reduce these payments if you genuinely believe your tax liability will be less in the current year.
You can discover details of our self-assessment services and what we can do for you here.