8 Tips For Preparing Your Tax Returns For January 2023
- December 14, 2022
All in all, tax is a complicated subject. It’s not something everyone is familiar with, however there is no doubt that tax is a guaranteed part of life and business. As a small business, tax returns are important but can be particularly complicated. With deadlines to meet and strict rules to adhere to, it is important to understand how to complete your tax returns correctly.
With The Self Assessment tax return deadline on 31 January each year, the deadline for filing your 2021-22 taxes is coming up on 31st January 2023. To ensure you get this right, our team has provided 8 useful tips for preparing your tax returns.
Firstly, what is a tax return?
A tax return is the completion of documentation. This documentation is used to inform the government, more specifically HMRC, of details surrounding the earnings of individuals and businesses in the UK. Within the document taxpayers will have to submit records from the previous year of earnings from various income types. Those required to submit a tax return include small businesses and self-employed individuals.
Since taxes are one of the largest sources of income for the government, this is a vital process that is required from a number of people within the country, every year. Our10 top tips below will help you better understand this process for small businesses.
Tax returns guidance for small businesses
1. Using the online system provided by the government will make this process easier for you
The system exists online in a readable and easy to navigate format. This has been designed to make the process as simple as possible for all who need to file their tax returns. However, if you prefer you can still submit a paper form.
2. Get your returns sorted ASAP
Instead of leaving your tax returns until the last minute, it is best to get organised and do this as soon as possible. Once the tax year ends on 5th April, it is a good idea to begin gathering the documentation for completion of your tax return for that year. As payment is also due on 31st January the following year, gathering the information and submitting your tax return early means that you know how much you will need to pay well in advance, allowing you time to plan for this.
3. Be sure you have all the necessary information to hand when filing your returns
When you start the filing process, be sure you have all the information you need at your disposal. This includes lots of your financial records from the precious year, so be certain you can have access to these in order to complete your returns.
It is important to note that details such as your student loan repayments and any child benefit received over the tax year will affect the tax payable, however many people often forget these.
4. Don’t miss the online filing deadline, else you will be subject to a penalty fine
The deadline date is well advertised and should be adhered to. For those who do not meet the filing deadline of midnight on the 31st January 2023, you will be subject to a fine. If your tax return is up to 3 months late, you will pay a fine of £100. If it is any later, you will have to pay more and will have to pay interest on late payments.
5. Be sure to go over anything you are about to submit before sending
You could be missing important mistakes by rushing through and not carefully reading each page. Be sure that you understand which sections you are required to fill in. It may be worth reading online guides and watching webinars to help you.
Information that is often missed from tax returns that will affect the tax owed include student loan repayments, child benefit income, and any repayment that you may have already received in the year from HMRC (particularly if this is your first year submitting a tax return).
6. There are certain EXTRA sections you may need to fill in, in some circumstances
Employees or company directors will need to fill in the SA102 section, while business partnerships will need to complete the SA104S or SA104F supplementary pages.
7. Sending a tax return if you’re not an individual
For those who are sending a tax return for a business partnership or non-resident company there are special forms that will need to be filled out on top of those mentioned above. Partnership tax returns require the completion of form SA800 in addition to the supplementary pages. Non-resident companies must complete the SA700 form.
8. Access the services of an accountant or accountancy firm to help you file your tax returns
When completing your tax returns it is useful to receive the advice and support of professional accountants. At Tree Accountancy, our especially trained tax advisers will ensure that you get the right tax advice for both your business and your personal tax affairs. So, you can get your tax returns right.