Why you should do your tax return earlier

Self Assessment

Well, have you been super organised and filed your Self Assessment tax return for the 2020/21 tax year which ended just a few weeks ago? Hearty congratulations if so!

If you’re generally someone to leave it all a bit late (and perhaps missed the 31 Jan ’21 deadline for 2019/20 tax returns, incurring a late filing penalty) then we have some excellent reasons why you should aim to file earlier in the future.

HMRC revealed recently that 1m taxpayers failed to submit their tax returns by the 31 Jan deadline, reversing the trend of steadily declining missed deadlines in recent years. But, given the current worldwide pandemic, it’s no surprise that there are more outstanding tax returns at this stage in the year than the same time last year.

Here are our reasons why you should file your Self Assessment tax return as early as possible:

  1. There’s less likelihood of errors when you’re not preparing it in a hurry – get it right and stay off HMRC’s radar
  2. It’s much less stressful for you (and your accountant if you use one)  if you file before the busy season
  3. Get it out of the way before Christmas so it’s not looming over you whilst you enjoy the festivities (remember that, the Christmas party not on Zoom?!)
  4. Preparing it earlier means paperwork will be easier to locate and details are fresh in your mind – this should save you significant time and ensure better accuracy
  5. Avoid a late filing penalty
  6. File early and you’ll have more time to save up if any tax is due
  7. You’ll receive any tax refund earlier
  8. More availability of resources in the quieter months, such as access to accountants and HMRC who are notoriously stretched in December and January
  9. You can have qualifying underpayments coded out if your tax return is filed by 30 Dec
  10. There’s more time to correct any errors in your current tax code
  11. You’ll have more time to file an amended return
  12. With more time to consider all available tax deductions and reliefs, you stand a better chance of reducing your taxable profits and saving more tax

If you have any queries about your tax position or are interested in optimising your tax affairs, please contact Julia Gallagher or call Julia on 01527 558539.