Get your Tax Return ready for summer

The Tax Return deadline for filing manual Tax Returns  is now 31 October.

For example: a manual 2010/11 Tax Return can be submitted anytime up to 31 October 2011 – although your tax bill may take some months to be calculated – which is why HMRC wants most people to file electronically.

If you file a manual Return by 31 October then HMRC will calculate your tax before the 31 January tax payment date.  You can file manually after that date but you will be hit with a £100 late penalty.

Only if you or your accountant files your Tax Return online will you have until 31 January to do it.

So we should really start preparing ourselves for earlier of the Tax Return deadlines.  In reality this means we should aim to submit our Tax Returns by the summer.

If you have an accountant you should aim to have your papers with them before you take your own summer holidays.  This leaves your accountant in a position to have your Tax Return out to you by September and so it can be sent in by October. Aim for these dates even if the return is going in electronically.  This has the following advantages:

1. More time to deal with missing items. (Lost P60 etc)
2. More time to handle queries from your accountant.
3. Early Tax Return completion means more warning of how much tax is due
4. Fees may be lower than if you supply things late to your accountant

Let’s assume you decide to take my advice and get your Tax Return done or papers to the accountant before the end of July.  What do you need to do?  Here are a few suggestions:

• If planning to file online (on your own) make sure you apply to HMRC for your security – takes about ten days to be posted to you. (This only needs done the first year) Go to www.hmrc.gov.uk and top left of the screen is “Do it online”.  Click on “Register (new users).”
• Check you have all forms P60 or P45 from jobs you had during the year. The wages department can help if you have lost them.
• Pull together all savings income details – dividends and interest amounts. Note you do not need formal interest certificates in order to complete a Return.
• Add up all your Gift Aid payments to charities and churches.
• Work out what you paid in pension contributions to your personal (private) pension.
• Landlords – get together your rental income figures (gross) then all the expenses including loan interest, repairs and letting agent fees.
• If you have a business then pull together the related income and expenses details.
• Keep a list of missing items and tick them off once received.
• Check your list every Monday – that way you will keep the momentum up.

By getting your tax papers off your desk before the summer I can predict a much more relaxing holiday.  One major worry is off your mind and the responsibility has been passed on – either to your accountant or HMRC.