By now, all those who have to file an annual self-assessment tax return should be aware that the last filing date and payment date is the 31st of January following the tax year.
So, the SA Tax return for tax year 2023/2024 is due by 31st January 2025.
HMRC have a list of all the deadlines related to self-assessement on their website – HMRC Self Assessment Deadlines
Should I file my self-assessment earlier than the due date?
Some businesses are aware of how busy their accountant/bookkeeper are in January so it’s a valid question. But this should not be the main reason as to why to file early! Yes, January is a very busy month for accountants/bookkeepers to finalise and submit clients SA returns. I am sure prior to this there has been plenty of requests from your professional for the information for your return and the benefits for filing before the deadline date.
What are the benefits of filing your self-assessment early?
At Tandem we actively encourage our clients to have all the required information over to us by the October following the end of the tax year, so we can complete a draft and return this to client by the end of that month.
We know that our clients rely on us to provide accurate and timely information for their returns. So, the earlier we can complete the return, the client is then in a position of knowing what their tax implication will be for the preceding tax year and can then plan how they will pay this amount by the due date.
A number of our clients operate in a seasonal trade, meaning they can be flat out all summer and really quiet in the winter months. The last thing they want is notification in January of a tax liability that could run into thousands, when their earning potential and cash flow may be at its lowest ebb. These sorts of clients want their return completed before the summer trade begins, so they know their tax liability, and can plan how they can pay this. Options could be to set a Direct Debit for 3 months to clear the account.
It’s all about knowing where you stand and what action you can take.
What happens if I can’t clear the tax liability in time?
Due to circumstances, it may be deemed that it is impossible to achieve clearing the liability by the deadline. Nowadays HMRC are very understanding on this and do offer a payment plan dependent on the individual circumstances. I always suggest pay what you can and then have that discussion with HMRC.
Are there any other benefits to filing my self-assessment early?
Another great benefit could be the reducing the payment for the July payment on account.
Of course, not being ideal, but some clients may find themselves trading down on the previous tax year. In this case we would aim in completing the return in May and requesting a reduction in the payment on account if applicable.
This could be vital cash kept by the individual or company in times of need. The most common scenario we have found this exercise useful over the last few years is when a sole trader changes structure to a limited company.
How can Tandem help with my self-assessment?
If you would like to find out more on how Tandem Business Solutions can assist you with self-assessment, please book a discovery call on the BOOK NOW button!