HACKS: Self Assessment Tax Return Tips

The deadline for filing your tax return is 31st January. HMRC are imposing an initial £100 for late returns which will increase this fine according to how late returns are.

It is reported that a staggering £5.7 million returns are currently unsubmitted despite there only being 3 weeks left until the deadline.

If this includes yourself, here are some tips to beat the deadline and save yourself a fine.

1. Routine - Get in a routine of compiling together your financial records. Ideally weekly but if not practical at least monthly. Routines are great so maybe set yourself the last Sunday of every month to get your financial admin done for the month.

2. Separate bank account - I always advise my clients to open or use a different bank account to their personal account. This should be used for all the business transactions, sales and expenses. The bank statements will form the basis of your accounting records and having everything separate gives more clarity and saves time.

3. Photographs - All business expenses should be evidenced by supporting receipts which is especially important if you are VAT registered. Rather than keeping hundreds of bits of paper everywhere take photographs and store then electronically in folders for each month. The original receipts can be destroyed and all your records saved on your computer/cloud. Not only does this save space in your office but it also means records are less likely to go missing.

4. Accounting software - If you have a vast number of transactions you may benefit from using a simple accountancy software program (this is required if you are VAT registered). There are many basic entry level options widely available and some are even offered free with some business bank accounts. This gives you the ability to raise invoices using their templates and also attach electronic copies of receipts. They are all cloud based so can be used on the move as long as you have internet access. You can also set up additional users on the software as well.

5. Use a professional - If even after these hacks it seems too much then using a professional will be a good investment. This will ensure that you are compliant with developments within HMRC and also avoid any penalties and sanctions being imposed because returns are late/incorrect. The cost of employing a professional will also be an allowable expense meaning that you save tax on the cost.

Don't be late and get a fine, use these hacks and get into a good system and keep on the right side of HMRC!