With tax deadlines on the horizon, make completing your tax return less stressful with FSB Tax Investigation Protection’s top tips for filing your self-assessment.
Running your own business means you get to do what you’re passionate about every day – but the thought of finances and filling out tax paperwork can be daunting. Don’t worry: if you’re new to self-employment or want to make the process less stressful, FSB Tax Investigation Protection is here to help.
Don’t miss the deadline
The self-assessment tax return deadline is 31 January following the end of the tax year for an online return
If you don’t meet the deadline, you may face a fine from HMRC – so don’t leave it until the last minute.
Registering to file online makes it easier to upload all the information that HMRC needs from you. If you’re busy, you don’t need to do it all in one go – simply save your form and fill it in when you have time.
Track your income and expenses as you go
From invoices to bank statements, keep accurate records of income and what you’ve claimed as business expenses throughout the tax year and make sure you declare everything. You can do this with a spreadsheet or online accounting software. Don’t forget that there are different rules if you run a limited company.
If you have other non-business sources of income or gains, these may need to be declared on your return, and you should have all the necessary records. You should keep records for six years, as HMRC can request them in the event of an enquiry.
You can start making your preparations and getting organised when the tax year has finished on 5 April. If you’ve been collecting everything you need as you go, you’ll save valuable time when it comes to filling in your tax return. Plus, if you do need to get in touch with HMRC, you’ll avoid the rush.
Gather all the paperwork and details that you will need ahead of time:
Unique Taxpayer Reference (UTR) number
National Insurance number
Details of all your income, including rental income, bank/building society interest or dividend payments
Records of relevant business expenses
If you’re employed, you’ll need your P60.
Budget in advance
Manage any surprises with your tax bill by budgeting in advance for what you anticipate your tax bill will be and getting ahead if you need to make any payments on account. Set aside a portion of your income every month for paying tax and National Insurance contributions.
Lastly, it’s important to seek advice when completing your return to clarify any areas of doubt and to ensure that your submitted return is complete and correct.
FSB Tax Investigation Protection provides advice, comprehensive support, and tax investigation insurance for most business-related HMRC enquiries, all at no extra cost.