Considering that the United Kingdom has the longest tax code worldwide, preparing even the simplest of tax returns can become challenging. There are several deadlines and responsibilities taxpayers should keep in mind. If your income taxes are still unpaid through a workplace Pay As You Earn (PAYE) HMRC system, you’re left with the option of submitting a personal tax return. According to the HM Revenue and Custom self-assessment system, you will have to estimate your tax amounts to be paid and update the government for a personal return. Completing a return is a must, whether you’re running a shared business, you’re a sole trader with a turnover of £1,000 or more. A failure to timely tax returns can result in serious complications like financial penalties and exposure to the risk of an HMRC investigation. This guide will tell you all about personal tax returns, including what makes you eligible for them and why you should opt for self-assessment.
What Makes You Eligible For A Tax Return?
People often stay confused in this area, and this negligence costs them fines and penalties. Therefore, you should know in what cases you might be eligible for a tax return. Here is a list of the most common reasons:
- If you’re self-employed or working in a partnership
- If you’re a director in a company
- If you have large amounts of investment income or savings and
- If you own land or property.
- If your family receives Child benefits and your income is more than £50,000
- If you have an overseas source of income
- If you have sold an asset recently (a holiday home, for instance)
- If you aren’t domiciled in the UK, and you’ve been abroad
The HM Revenue & Customs and their staff will not advise you on organising your affairs and minimise your tax. However, by consulting a professional, you can ensure that you’re paying the right amount of tax.
Why Should You Opt For Self Assessment?
Although you have the option of being one of the many taxpayers who filed their last tax return just hours before the HMRC deadline, there are several reasons why you should go for self-assessment:
1) You’ll Get Proof Of Your Income
If you’re buying an asset such as property, you’ll need a mortgage, or you’ll have to re-mortgage the one you have. While studying your finances, a mortgage company will require two or three years’ proof of your income. At this point, you’ll be able to tick your latest tax return off your list. If your returns are up-to-date, it will give you a head start on the paperwork.
2) You’ll Be Able To Manage Your Cash Flow
It’s better to know sooner what amount of tax you’ll have to pay at the end of January. The sooner you’ll know, the sooner you’ll start to manage your cash flow accordingly. It will also ensure that you get enough time to plan and pay your tax bills, rather than struggling to arrange a large amount in a short space of time.
3)You’ll Be Able To Claim Your Tax Refund Early
There is no need to mention that the earlier you submit your self-assessment, the sooner you’re likely to receive any tax refund due to you, especially because HMRC won’t be dealing with too many claims at that time, considering the load increases as the deadline comes near.
Builders, plumbers or electricians are often likely to receive tax rebates. For them, it is an ideal option as they won’t have to wait until next year to receive their refunds.
Blue Water Accounts Can Help!
At Blue Water Accounts, we provide a reliable self-assessment service by offering a comprehensive groundwork of self-assessment tax returns. We will make sure that your tax returns are filed timely, seamlessly and without any chance of mistakes, assuring you that you will never have to HMRC enquiries. We have an efficient approach to file your Annual Self-Assessment Tax Return quickly, and providing you with the best service is our primary concern.
To Wrap Up:
If you’re looking for an expert self-assessment accountant, come to us, and our accountants will minimise your risk of tax exposure. Another perk of availing our service among many others is affordability, and this is what makes us your number one choice.