The deadline for filing your 2013/14 tax return is Friday, midnight 31 January 2015 – still 45 days away. You might feel that it is not worth worrying about now- and certainly not worth troubling your accountant about. After all, with half of December and the whole of January still to go what are the benefits of filing now?
Well, other than helping you conserve the energy you spend on worry and beat the procrastination habit here are some reasons why it makes sense to file now:
- You won't spend your Christmas break counting money
Christmas has historically been a busy time for both the taxpayers and HMRC. Last year a total of 23,059 online returns were filed over a 3-day Christmas period which was 12% higher in comparison to the 2011-12 tax year total of 20,563 tax returns. On Christmas day last year over 1,500 tax payers submitted their tax return online which was 1% up from the 1,548 people who filed online on 25 December 2012. This year won’t be different with thousands of taxpayers expected to spend the Christmas break submitting their tax return.
- You'll get through to HMRC helplines
- You can get tax collected through your PAYE tax code
- You'll get high professional advice at the right price
- You'll avoid penalties
- You'll be able to give your best effort
HMRCs' helplines has been called a lot of things lately and helpful has not been one of them. In the run-up to this year's deadline, consumer watchdog Which? conducted a research and concluded that taxpayers were struggling to get through to HMRCs helplines. They said that taxpayers calling to make an enquiry were put on hold and waited an average 18 minutes to speak to someone - with a longest recorded delay of 41 minutes. Nearly a third of the callers were cut off by the system with callers being told that the helpline was busy. Imagine trying to get in touch with HMRC during peak filing season (January). Give yourself one less thing to worry about and file your tax return now.
If you owe less than £3000 in overdue tax and want HMRC to collect the tax you owe through your tax code, you’ll need to submit your online return by midnight on 30 December. This can be a great option for employees or pensioners as paying the tax bill from your wages or pension throughout the year can ease the pressure on cashflow.
If your tax affairs are complicated and you have incomes from several sources (savings, investments, rental property or freelance work) it would be wise to hire an accountant to help you prepare, check and file your tax return. However, enrolling a professional accountant’s help during peak season can be difficult as they start prioritizing existing clients at this time of the year. Start looking now and you will have a much better chance of finding the right accountant, not just to file your tax return but also to help you with your overall business.
The deadline for submission and paying any tax due is 31 January 2015. Late returns, even by a day, incur an initial £100 fixed penalty, which applies even if there is no tax to pay or you have already paid any tax due. After this point, you pay £10 per day from 3 months onwards (up to a maximum of £900), then a fixed penalty of £300 (or 5% of the overdue tax) in addition to the earlier charges. At 12 months, a further £300/5% charge will be made, on top of all other charges mentioned previously. In some cases the penalties can be even higher. It’s best to get your house in order now.
You might think that you have a plenty of time to prepare your return but what if you discovered later that your tax return is more complicated than you expected? Then you'd have everything but time to figure out what to do. Also it is very easy to make errors in calculation and mess up the simplest of tax returns when one is in a hurry. Why not get over with it now and forget the nagging thoughts.
One of the most helpful aspects of online filing is that you can part-save your tax return and come back to it if you don’t have enough time to complete it in one sitting. So what are you waiting for? Don't procrastinate any further. If you have yet to file a return, login into HMRCs online portal and get cracking right now. But make sure you use the genuine HMRC portal and not one of the copycat websites masquerading as HMRC.
For more information on “How to fill in your tax return” please read the HMRC guide. For general help and advice visit www.hmrc.gov.uk/sa or call the Self-Assessment helpline on 0300 200 3310 (open 8am to 8pm, Monday to Friday, and from 8am to 4pm on Saturdays).