The Top Ways to Get Ahead with Your Self-Assessment Tax Return

Completing your tax return early is always the safest approach. It can help you to plan your finances and ensure you can afford to pay the money you owe; it will also give you more time to prepare the return to ensure that the information you provide is correct. Submitting your return early gives you more time to pay your tax bill, as the deadline for making payments is fixed, and avoids any stress that arises from taking care of this responsibility at the last minute.

The expert Chartered Accountants at Monetta have created the following guide, breaking down the top tips that will help you to complete and submit your self-assessment tax return early. If you need support in preparing or filing your return, get in touch today or filling out our online enquiry form.

Start as early as possible

You can submit your self-assessment tax return as soon as the previous tax year ends. Filing your return early avoids the challenges that can arise when you leave it until the last minute, and it can be much easier to make sure you get it right without the pressure of a looming deadline. Filing taxes can be a difficult and complex process and it is best to give yourself as much time as possible to get it right. Once you have filed your return, you will also know how much money you owe and can plan around this to ensure you can pay it when the bill is due.

It can be challenging to prepare and file an accurate tax return, so you should give yourself plenty of time. If you begin the process early and reach a stage where you feel you need support or guidance, it can be much easier to bring in a professional accountant or tax expert to help you if you have a lot of time before the deadline.

Plan properly

The deadline for submitting your self-assessment tax return will depend on whether you intend to do so online (31st January) or by paper (31st October), so you should plan in accordance with this. For some taxes, it is now a legal requirement to file your return online. While this does not apply to self-assessment tax returns yet, it may benefit you to become familiar with the process of filing online, as this is likely to become mandatory over the next few years. You can also check the government’s Making Tax Digital guidance to determine the legal requirements for filing other tax returns.

Before doing anything, you should find out what documentation you will need to complete the process. This may include:

• Records of your income and business expenses;
• Your National Insurance number;
• The Unique Taxpayer Reference (UTR) that you were allocated when you registered;
• Details of any untaxed income;
• A P60 for the year, if relevant; and
• Records of any charity donations or pension contributions that may offer tax relief.

Compiling all of this information ahead of time will allow you to work through the tax return process without having to pause to find other information.

One of the key reasons to complete your tax return early is so that you can budget and make a plan for your payments. The deadline for your payments will not change, which means that you can spread your payments over a longer period of time by filing your return early. You can also plan for the year ahead and estimate your tax liability based on what you owe for the previous year.

Another advantage of completing your tax return early (by 31 December each year for online returns and 31 October for paper returns) is that if you currently have tax deducted via PAYE, any additional tax can be collected via an adjustment to your PAYE code rather than by a separate payment. For example, tax due on rental income can be paid out of an adjustment to wages if you already have tax collected from your salary, provided you submit your return early.

Keep detailed records of your transactions

It is mandatory for businesses to keep records of all their transactions for a minimum of six years. However, this is also good practice for individuals to offer you better oversight and control over your finances. Keeping details of each transaction will help you to fill out your tax return more easily, so you should consider what information you will need when you begin recording your transactions. If you are self-employed, you should keep your personal and business finances separate, to make it easier to file an accurate return.

Using accounting software will help you to better keep track of your transactions and automate much of this process, including aspects of filing your return. There are several software packages that integrate with the government’s Making Tax Digital platform, and which have flexible options depending on your business’ needs. If you do not already use digital bookkeeping and accounting software, consider making the switch.

Register and submit online

Submitting self-assessment returns online is more efficient than doing so by post. Thanks to the simple portal, step-by-step guidance and helpsheets available on the HMRC website, you can quickly and accurately input the necessary information and submit your return. Many digital accounting software packages now integrate directly with this system to make it much more convenient to submit your return quickly and accurately.

Even if you have the option to submit a paper return, you should register online. The legal requirements to do so will apply to self-employed businesses and landlords from 2024 onwards and will continue to expand in the future, so it is worthwhile to learn the system and gain experience using it as soon as possible. To register and submit your self-assessment tax return online, visit the government website.

Seek help from a chartered accountant

Preparing and submitting your tax return can be difficult. If you are unsure about how to proceed, consider seeking advice from the expert accountants at Monetta. We will be able to guide you through the process, offering advice on what sort of transactions you will need to include, analysing your finances and tax bill, and potentially identifying opportunities for you to save money or reduce your tax liability.

To speak to us today, call us. Alternatively, fill out our online contact form and we will return your call at a time convenient for you.