Self Assessment Tax Returns, questions we get asked a lot and some interesting facts.

Who needs to complete a Self Assessment Tax Return?

Self Assessment Tax affects individuals, partnerships and trustees who receive tax returns, together with companies that are not resident in the UK and are not trading in the UK through a permanent establishment. It also affects individuals who do not receive a tax return, but need to claim a tax relief or allowance and companies making claims outside their company tax returns.

Accountants charge too much for Self Assessment Tax Returns, I am just a sole trader.

If your accountant is charging you too much for your Self Assessment Tax Return, you need to speak to us today!  Our service is second to none, and we always aim to save you much more than the cost of our services ever would!  We know how difficult starting a new business is, and it is in our benefit as well as yours to do everything we can to help you flourish.

When did Self Assessment Tax start?

The first year for Self Assessment Tax was the 1996 – 1997 tax year (April to April), with all partnerships being included in Self Assessment in the 1997 – 1998 tax year.   Previous to self assessment, HMRC would assess each taxpayer!

When do I need to complete my Self Assessment Tax Return?

Paper returns must be filed by 31st October following the end of the tax year. The deadline for filing self assessment returns on-line is 31st January. Returns issued after 31st July following the end of the tax year must be filed three months from date of issue or 31st January if later and the return is filed on-line.

So for example, your trading between 6th April 2019 and 5th April 2020 would need to be submitted;  on or before the 31st October 2020 if you use a paper tax return form (SA100), or if you submit your self assessment tax return online, on or before 31st January 2021.

Can’t I just have my self assessment tax return filed straight away?

Yes, you can file your tax return for the previous year from 6th April.  There are no advantages filing later in the year, and actually it allows your accountant more time to make sure you have included everything you are entitled to claim as expenses!   Filing your tax return straight away does not mean you have to pay your tax bill any sooner than someone who files on the 31st January!

If you are in receipt of certain HMRC tax credits, filing earlier should mean you are not being over paid, or under paid.

I have just started working for myself, when should I let HMRC know?

If you do not receive a notice to file, but have received untaxed income or made a capital gain in the tax year have to inform HMRC by 5th October following the end of the tax year. However, for National Insurance purposes a when you start new self-employment, you must notify HMRC as soon as you start, within the first three months of self-employment.

I missed my filing deadline, it was due last week, last month, last year, or even for previous years, what do I do?

Firstly, do not panic, but you should act straight away!  HMRC can be very accommodating of genuine mistakes, but you need professional advice now!  Click here to contact us.

When will I know how much self assessment tax I need to pay HMRC?

As soon as we complete your return, ready for submission, we request your approval before sending to HMRC, at this point you will have a breakdown of any payment due.

When do I need to make Payment on Account to HMRC?

If you have Self Assessment Tax bill is more than £1,000 and less than 80% of your income is from a PAYE scheme, you will be required to pay your tax bill by 31st January as normal, but also half as much again against your future prospective earnings.  If you think you may fall into the Payment on Account scheme, you should contact us to clarify.

As an example; if your tax due for April 2018 to April 2019 is £2,000 , before 31st January 2020 you would need to settle this tax bill, and also your Payment on Account of £1,000 for the year April 2019 to April 2020.    In other words, you would pay a tax bill of £3,000, made up of the previous years bill, and half of the following year – on account.

If you have any questions at all concerning Self Assessment Tax, or any other taxation issue, please do contact us today, you will be glad you did!

An unbiased guide to choosing your accountant

Can I just choose any accountant? 

Yes, all accountants should be able to file your tax and corporation returns.  However, finding the right accountant can save you and your business lots of wasted time, stress and of course money.

How can I tell if an accountant is any good?

While you are searching through the internet, you will no doubt see many special offers of accountancy services at amazingly low costs – there is of course more to judge an accountancy service by than the initial cost, and choosing the wrong accountant can cost you a whole lot more than any amazing limited offer low price!  You should be looking for an accountant with a proven track record of customer service,  who ideally has experience in your business field.

Should I speak to my new accountant before using their services?

Absolutely you should!  You are about to form a business relationship which involves trust, and could last many many years.  If you can not get a response from your accountant now, what makes you think it will be any different when you really need their help?

What can my accountant help me with?

Your accountant should be able to free you from many of the financial and administrative tasks, most of which probably take you away from your core business. Your account will be able to help you with VAT , PAYE (payroll), personal and business taxation, year end accounts, CIS payments, and many more aspects of taxation.  Not every business owner is good with figures, and making mistakes with taxation could prove very costly.

Monthly fee or Pay as you go?

Wouldn’t you rather see what you accountant does for the money you pay them? You can save yourself money by keeping your own records of income and expenditure, rather than paying your accountant to do your book-keeping.  If you are using regular services from your accountant, such as weekly or monthly payroll, book-keeping etc, that might be a valid case for opting to pay a regular monthly fee to cover the services you use, otherwise pay as you go could save you money.

Should I be paying my accountant for advice?

Sitting down with your accountant and asking questions can save you and your business time and money, unless this forms part of your monthly plan, you can probably expect to pay for this advice, however it would be unlikely you would be charged for the occasional bit of telephone or email advice.

I am about to start a new business, should I find an accountant?

Accountants will generally give the first meeting free of charge, so this is an ideal opportunity for you to talk over your business and ideas with your potential future accountant.   They will probably be able to offer lots of advice from similar businesses they have worked with, local area information, business networking events, and of course tax implications.   Once you business starts to grow, it will be in your best interest to have an existing relationship with an accountant, rather than rushing to find one at the last moment.

I already have an accountant, but am not happy, what can I do?

Quite simply, you can change accountants!  As long your account is paid to date, your existing accountant should not have any issues releasing any previous accounts information to your new accountant.    If you are unable to retrieve your accounts from your accountant (due to cessation of practice etc.), you new accountant should be able to retrieve your tax information from HMRC directly.

If you would like more information about the services we offer, or accountancy in general, please do click here to contact us.