Our podcast was published at 29 November 2022, to keep our customers well informed leading into the busy tax return season of December 2022 through January 2023.
All of our podcasts can be found at
https://anchor.fm/michael-beech88
An Update - Tax Year to 5th April 2024
As the 5th April 2023 Tax Season deadline has now closed ,we would like to give an update to the Podcast.
Our clients tend to be in the Midlands Region, but we can cover on a National basis. Sometimes we find with the public they prefer a local Accountant, just in case they want to discuss things face to face, rather than on a Zoom Meeting, or on the Telephone.
The Pandemic did, however, teach us that a lot of things can be done online.
The Tax Year is running from 6th April 2024 to 5th April 2025 at the moment.
In theory, if you were very up to date, and you were not awaiting a P60 from an Employment or similar, you could do your Personal Tax Return on 6th April 2024. One day after the close of the latest, Tax Return period, which was 5th April 2024.
HMRC do, give you, until 31st January 2025 to
1. Know what to pay well in advance. If for example , you did your tax return in May it would give you time to plan for payment by January. If you have to do Payments on Account - listen to the Podcast if you don't know what these are - they also help that situation.
2. Time - Mad Panic Rush in January ? No thanks! If you do it early: you have good time to get all your Paperwork together, if you rush it at last minute you may miss vital things to claim back, you may rush and miss items!
3. Out of Date Financial information about your Business How do you know how your business is doing in a timely manner? Doing your Tax Return in January is so far out of date by the time you do your Tax Return you will have no idea how you are currently doing. An example
- You do your Tax Return in January 2025.
- It covers your trading period of 6th April 2023 to 5th April 2024.
- You want to know
as up to date as possible
how your business is faring
- It's 9 months out of date. Too late to know then how things are going.
- If say , you did it in May, you get to know pretty soon how the past tax year has fared up until 5th April just gone. It's current up to date information. Essential info, for you, the business owner.
4. CIS We have numerous CIS contractors as clients. More often than not because of it's very nature, with CIS, you are entitled to a rebate. You want to get your hands on that rebate as soon as possible. You would not want to leave it till January would you ?
5. Your Tax Adviser wants to do your Tax Return as early as possible
Your Accountant + Tax Adviser prefers that you come early to them. As they already have a raft of work to do throughout the year. Going in January to your Accountant just adds to their stress. Next year = Michael Beech Accountancy offers all customers that come by 31 May 2025 a 20% fee reduction. Further our Terms of Engagement letter stipulates that Tax Data is with us by September of each year, in order that we can do the work in a timely manner with no rush.
Ideally, you come to us in May 2023.
I can do my own Personal Tax Return?
1. Accountants have already done all the years of study or Research in what you can and cannot claim. They know the SA system so you don't have to waste hours on Researching the legislation and to be safe in the knowledge if you get an Enquiry from HMRC you can handle it on your own.
2. Why waste hours learning all the Regulations and Legislation when you can concentrate on your core business - what you do best. Some people don't like to deal with Finance and would rather leave it to someone else to do.
3. Letters from HMRC - Enquiries or Errors on your Tax Return if you do it yourself. This is where hiring a Specialist Qualified Accountant comes in. Someone that has spent years qualifying and doing tax returns, means you are actually paying for their years rather than hours, but at a fair price, so you don't have to worry about doing the Tax Return yourself, where, unbeknown to you, you could do an error, that actually causes you to pay more in Tax. Or you receive an Enquiry in the post, at least by hiring a Trained Professional, you know that they will work with you to deal with the Enquiry. They may even just take care of all of the Enquiry, if it is a simple Enquiry.
4. It can be quicker to use a Tax Adviser than waste hours on it. Is Tax Simple? I'd say no.
5. We can act as a layer of protection when doing your Tax Return. If you hire an Accountant to do your Tax Return and they go through your Paperwork, they may advise you not to put certain things through. This ultimately is to protect you from overclaiming and thus having to deal with questions from the Authorities. On the other hand, there can be reliefs and allowances you are entitled to, that you don't know about. We can guide you on claiming those. We keep it compliant, and legal when doing your Tax Return to keep you and us as safe as possible.
What does Payment on Account mean?
Sometimes if you make more than a certain level of taxable earnings, and your tax comes out at more than £1,000, you are then asked to do a Payment on Account for the following tax year.
(This is essentially a payment up front for the following tax year).
The Tax Authority believe that your tax will be similar the next year, they ask you to pay 50% of half of this year's tax by 31 January and then after that another 50% of half this year's tax at 31 July.
The first time it happens, in the lifecycle of your Trading, can come as a bit of a shock. As it is essentially 150% of Tax to pay by January.
Let's look at an example
There are three outcomes here.
Firstly, it pays to do your Tax Return early, so you know well in advance of what is coming up to pay.
Secondly, only one of the payments is a payment up front. (The January one). The July one is 3 months after that tax year has finished.
Thirdly, if your trading goes down, it is like having a credit and you could get some of it back. If you cease trading if you retire for example your final tax year bill will be covered by much of the Payments on Account to either cover your tax in full, or potentially you will get a rebate for the tax you paid up front.
If you would like to join our existing client base of satisfied customers and avail yourself of not having the stress of Self Assessment Tax Return worry in the Winter, please do call us or come to a 30 minute meeting, to discuss things further.
Sign up for a fair fee, don't burden yourself with the stress of it into the future.
