Tax tips – Self Assessment and ensuring a smooth process

By Jyoti Onthriar ATT, Tax Associate Director

Whether you’re a Self Assessment veteran or filing for the first time, the process can be daunting if you’re not prepared.

I can’t stress enough how it is vital to know your deadlines, gather the right information, and avoid costly mistakes.

Deadlines you can’t afford to miss

HM Revenue and Customs (HMRC) has strict deadlines when it comes to Self Assessment tax returns. Missing them will result in penalties, so make sure to note the following key dates:

• 5 October 2024 – If you’ve never filed a self-assessment before, you must notify HMRC by this date. Registering for self-assessment is straightforward and can be done online.
• 31 October 2024 – The deadline for submitting your tax return by paper. If you’re sticking with traditional methods, this is your cut-off.
• 31 January 2025 – The final deadline for filing your online return and paying any tax you owe for the 2023/2024 tax year. Most people choose to file online as it offers more flexibility.

If you have payments on account, which means you’re making advance payments towards your next tax bill, there’s an additional deadline to remember:

• 31 July 2025 – The deadline for making the second instalment of payments on account.

What happens If you are late?

Late filing comes with automatic penalties, and these can escalate quickly:

• £100 fine if your return is late by just one day.
• After three months, a penalty of £10 per day will accrue for up to 90 days.
• After six months, you’ll be hit with a further penalty of £300 or 5 per cent of the tax due (whichever is greater).

Late payment penalties are equally harsh, with interest accruing from the deadline date.

If you’re even slightly behind, the costs can spiral, so you must pay attention to these deadlines.

Documents you will need

Before sitting down to file your return, ensure you have the following at hand:

• Your P60 or P45 (if relevant),
• Any statements for savings interest, dividends, or rental income,
• Invoices and receipts for any work-related expenses or allowable deductions (such as business travel or home office costs),
• If you’re self-employed, you’ll need a complete set of accounts.

You cannot guess or approximate your figures as mistakes can lead to an HMRC investigation.

What if you don’t know your final profit?

If you’re unsure about your final profit figures for the tax year due to a different accounting period or awaiting valuations, you can submit provisional figures.

Just make sure you inform HMRC that these are estimates, and you’ll need to update your return once you have the final numbers.

Remember, you have 12 months from the deadline to amend your return.

If more tax is due after correcting your figures, you’ll need to pay interest on the shortfall. However, if you’ve overpaid, HMRC will refund the difference with interest.

Payment options

When it comes to paying your taxes, there are several options:

• Bank transfer or Direct Debit are the most common.
• You can also set up a Time to Pay arrangement if you’re unable to meet the deadline. The key here is to contact HMRC as early as possible.

Special circumstances

• If you want HMRC to collect your tax directly from your wages or pension, you’ll need to submit your online return by 30 December 2024.
• For trustees of registered pension schemes or non-resident companies, the paper return deadline is extended to 31 January 2025.

If you leave Self Assessment to the last minute, you risk not only penalties but also inaccuracies that can lead to costly investigations.

As chartered accountants and tax advisers, we can provide you with expert advice on all things Self Assessment and make sure that you avoid any financial penalties.

Contact us today for further assistance.