Income Tax return? That's not due until the end of January we hear you say!
Well, that may be true, BUT there are significant benefits to be had if you file your tax return before the 31 January deadline. They are:
File now pay later!
It's a common misconception that you have to pay your tax bill as soon as you file your return. For those that leave it until the last minute, that is true. However, if you were to file your tax return in say August or September, you don't need to pay any tax that is due until 31 January the following year.
File now and reclaim now!
Similarly, if you are due a tax refund, file your tax return now and you will receive your refund as soon as HMRC has processed your return. This is likely to be within a few weeks after you have filed your return and not after 31 January. So why delay HMRC in paying you?
File now, put aside money to pay your tax bill in January
By filing your tax return now, you will know how much money you owe HMRC and so can put aside monthly amounts towards the total amount. This can help with your cash flow and mean you don't have one big lump sum to pay in January. This could also mean you don't have to borrow any money in January to pay your tax bill.
File now, get a quick turnaround on your accounts and tax return
Many people leave it until December and January before sending their books to their accountants for them to prepare their accounts and calculate their tax bills. As a result most accountancy firms, including DWilkinson&Company, get snowed under with client records at that time of the year which can slow down turnaround times. The summer and early autumn months are generally quieter for accountants, so we can work on your accounts much quicker and turn them around faster. This means you get your accounts back sooner and know your tax position sooner as well.
File now when tax year-end information is close at hand
Traditionally, most financial institutions will issue their clients with annual statements shortly after the end of the tax year (5 April), e.g. banks, pensions, investments, P60s, etc. Strike while the iron is hot, and these documents are close at hand, and send them across to your accountant so they can use this information to complete your tax return. Otherwise, you'll only put this type of information in a 'safe place' which will be forgotten by the time it comes to December/January and you're panicking to find all the relevant statements your accountant will need!
File now and make your accountant happy!
And last, but by no means least, if you file your tax return well before January your accountant will be forever grateful. December and January are always very busy times for accountants as many clients leave their tax and accounting affairs until this time. Consequently, many accountants end up working evenings and weekends throughout January to ensure clients' tax returns are processed correctly. So, put a smile on your accountant's face and take your income tax books and records to your accountant now (July to October would be great!). By doing so, they can manage their workload better and be more proactive in managing your tax affairs. Plus you will also benefit from all the other reasons detailed above!
If we can help you complete and submit your income tax returns now, do get in touch on 0113 320 0001 or email us at office@dwco.co.uk.