Are you stressing over your Self-Assessment Tax Return at the moment? If you’ve been efficient and got it done with months to spare, you’ll be fine, but all those who’ve left it to the last moment must be having sleepless nights.
So, what do you need to remember, not only to reduce the stress now, but to make the process simpler for next year?
1. Organise Your Tax Paperwork
It’s vital for your Tax Return to get your paperwork in order — whether that’s literal paperwork or electronic files. You’ll not only need it for your own calculations, but also in case HMRC chooses to check your figures. Remember that they have the right to follow up anyone, whether or not there’s reason for suspicion.
To avoid a scramble when you come to do your Return, it’s best to have a system set up where documents are filed as they come in. It needs to be organised by category, and you should always make copies, whether that involves scanning physical documents or backing up computer files.
2. Put Your Business Expenses in Categories
Most of your business expenses can be claimed as tax deductions. There are a few exceptions, such as hospitality, and you can check on the Government’s website to find out what you can and can’t claim. Alternatively, your Accountant will be able to tell you.
The expenses you claim will need to be divided into relevant categories, and it’s best to do this well in advance of filing your Return. Ideally, you should itemise your receipts and invoices and put them into categories as they come in, as well as noting a full explanation of what the expense was.
This way, you’ll either have the information at your fingertips, if you’re filing the Return yourself, or be able to supply it in organised form to your Accountant.
3. Don’t Miss Out on Deductions and Credits
If you’re a small business, there are a number of tax credits that you may be entitled to. This is on top of deductions, such as claimable expenses, that can reduce the amount of tax you’re liable to pay.
You’ll be able to find out what you’re entitled to either from your Accountant or from your software package. Don’t leave it till the last minute, though, since having to find out about these, especially the credits, might delay your Return.
4. Find Support
Even if you have a bookkeeping or accounts team, Tax Returns can be extremely stressful. This is even worse if the team is just you. Preparing your Return involves a lot of work, especially if you’ve left it late, and you risk burning out and missing the deadline.
The whole process is likely to run more smoothly if you plan ahead for any help you might need. If you leave it till January, Accountants are going to be busy — so get in early and make sure they’re busy with your accounts.
Whether you’re rushing to get your Self Assessment Tax Return ready for the 31st, or whether you’ve already moved ahead to planning for next year, get in touch with me now for a free call to explore how I can help you.