Taxpayers have been getting organised with 950,000 already having completed their 2020/21 tax returns with 63,500 filing their self-assessment on the first day of the tax year, HMRC has revealed.
There are many benefits of getting your tax return filed early. It helps with planning towards payments and also means if you are due a refund you will get this back much quicker.
Although the 31 January 2022 feels far away, it is important to set time aside to complete your 20-21 self-assessment tax return and pay your tax bill (if you are required to submit a self-assessment by HMRC). You also will want to ensure that you understand how to declare any covid support grants correctly.
- Incorrect figures – double check the figures you are reporting to ensure they are complete and accurate
- Not declaring all income or capital gains – you must ensure your self-assessment is
- complete and reports income or capital gains from all sources (employments, pensions, interest, dividends etc)
- Not declaring covid support grants you have received due to the pandemic
- Claiming for expenses that are not allowable – as a business owner it is your responsibility to ensure that the expenses claimed on your tax return are qualifying business expenses
- Entering incorrect UTR or National Insurance Number – ensure your personal information is correct so that there is no issue submitting your return (especially if you leave it last minute)
- Selecting boxes that aren’t applicable to you – ensure you only include relevant information on your tax return. HMRC publish guidance notes on their website to help complete your return correctly
What to do if you make a mistake?
If you do make a mistake on your tax return you’ve normally got 12 months from the submission deadline to correct it. This is called an ‘amendment’. If you realise after this date, then you will need to contact HMRC to discuss the best action to correct your return.
The penalties for late returns
There could be penalties and interest payable for late submission where HMRC do not accept an appeal setting out a reasonable excuse for late submission, so we urge you not to leave things until the last minute. It is better to get your return submitted while events are fresh in your mind.
HMRC published some bizarre excuses they received from taxpayers as to why they didn’t submit their self-assessment return on time. To clarify these excuses did not qualify as ‘reasonable excuses’;
- my mother-in-law is a witch and put a curse on me
- I’m too short to reach the post box
- I was just too busy – my first maid left, my second maid stole from me, and my third maid was very slow to learn
- our junior member of staff registered our client in self-assessment by mistake because they were not wearing their glasses
- my boiler had broken, and my fingers were too cold to type
Self-assessment is designed for individuals to complete. However, some people prefer to appoint an accountant to prepare theirs on their behalf. If you need help deciding whether you need to submit a self-assessment return or completing your self-assessment return, please don’t hesitate to get in touch with us to discuss. Missed deadlines or payments will result in penalties so please ensure you understand the deadlines and your responsibilities. If you need to change your return for whatever reason, then we can help with amended returns.
Allchurch & Co – Chartered Accountants