K A Farr & Co, Chartered Accountants always promote good practice when your business is preparing for the self assessment deadline. It’s your job as a business to plan ahead and submit your tax information in a timely manner.
However it is easy for us to say but much harder to put into practice. 25-30% of firms are implementing improvements and client management strategies throughout the year to make their lives a little easier when it comes to the workload. At K A Farr & Co we have been doing this for a number of years now with great success not only helping with tax, accounts and bookkeeping but making sure you are ready for the SA deadline.
The groundwork for self assessments primarily takes place during April – October and one of the keys to influencing our clients to ensure they get out of their paperwork slump is that we communicate to them what to do and a date of when to do it by. We also guarantee to complete clients’ accounts within 3 months of receiving their completed books & records.
Here are 5 tips you can use throughout the year to ensure your SA is on time.
First of all if you have never filed a tax return before, then register with HMRC. Once you have registered with HMRC they will issue you with a Unique Tax Reference. You will need to include this in your tax return.
Why should you register now? Before you are issued with a UTR, HMRC will send you an activation PIN in the post, which you will need in order to complete your registration. The longer you wait to register, the more likely your PIN will be delayed.
Identify The Pages You Will Need To Complete
The SA tax return has a number of pages; so in preparation it’s a good idea to make sure you know which pages need to be filled out.
All tax returns have a main return page, this is where you would input common income types like bank interest received and dividends you have received on shares owned. The main return page also covers everyday tax reliefs, like those on money you give to charity or if you contribute to a pension.
If you have a separate income from another job, let out property or sole earnings from a sole trade business or partnership then you will be required to fill out a separate set of pages for each kind of income.
Why should you do this now? It will save you a lot of time and hassle to use online accounting software to complete your SA. There is a range of software options which are available, but if you are already aware of what types of incomes you have and which pages you need to fill out then you will be in a much better position when you come to deciding which software to use.
Collect Your Paperwork
When you have decided your sources of income, make sure you have collected all of the information you will need to fill in the relevant pages on your tax return. For example, if your bank account pays you interest you will need to have a record of how much interest your bank pays you by providing the interest certificate which you will have received after 5th April.
Why should you collect all of the paperwork?
The earlier you get your paperwork collected and in order the more time you will have to locate anything which is missing or if you need to obtain any duplicates. Similarly you can ask a Chartered Accountant like K A Farr & Co to help you prepare your tax return, this enables you to provide your accountant with the paperwork who can help by asking the right questions and flag up anything that may be missing.
Are your books up to date?
If you are a sole trader or are in partnership, then you will need to ensure your businesses books are up to date and complete up to the end of the accounting year which will be reported on your tax return. That might be the year up to the 5th April 2015 or it could be up to an earlier date, you must check with your accountant if you are unsure.
It is your job to make sure you have posted all of the businesses income and costs to your accounts. Your business’s profit which is what you will pay tax on is calculated by subtracting your costs from your income, so it is important that this information is correct and up to date.
Why do it now? If your books are incomplete when you come to fill in your tax return, you could pay too much or too little tax which means you could risk paying fines and penalties for your discrepancy. You could also be fined by HMRC for inadequate record keeping.
And finally, find an Accountant
At K A Farr & Co Chartered Accountants we understand that the UK’s tax system is complicated and unless your business is very small we would highly recommend that you engage with an accountant to talk you through things. They can provide you with help and advice for your business as well as talk you through the tax return process.
K A Farr & Co are accredited tax specialists, for more information on how K A Farr & Co can help you organise your paperwork for your self assessment tax returns please call 01704 211 434.