For some business owners, the last-minute approach is just how they operate. Often, they don’t have much of a choice, what with a demanding to-do list absorbing all of their spare time. However, for others, organisation is the cornerstone of success – and sanity.
That’s why, for those who fall into the latter category, submitting their Self Assessment tax return as early as possible can be an appealing prospect. But is this something you’re actually allowed to do? In this article, we explore that very topic.
Can I submit my tax return before the deadline?
Yes! You can file your Self Assessment tax return well before the deadline. In fact, HMRC welcomes those who do so as it prevents chasing overdue submissions and issuing penalties.
As soon as the tax year ends, you can submit your tax return for that period. So, once the new tax year starts on the 6th April, you can file your return for the previous tax period straight away.
Does that mean I’ll need to pay my tax bill earlier?
Not at all. Submitting your tax return earlier doesn’t change the payment deadline for paying your tax bill to HMRC, so you won’t need to worry about that.
The benefits of submitting a tax return early
Although you do not have to submit your tax return early, there are lots of very good reasons why taking this approach can be beneficial for you and your business.
Submitting your tax return earlier makes the process less stressful
As with most tasks that have a hard deadline attached to them, the tax return process is far less stressful when you leave plenty of time for it. Getting it done early and out the way is even better.
There’s less risk of errors or accidental omission
Submitting your tax return well ahead of the deadline allows you enough breathing space to complete the process accurately and thoroughly.
When you leave it until the very last minute and time isn’t on your side, it’s far easier to make mistakes or overlook information. These kinds of avoidable errors can cause all sorts of hassle later on. Nobody wants a scary-sounding letter from HMRC.
Improve financial planning and forecasting
The earlier you submit your tax return, the sooner you’ll know how much you owe on your tax bill. Once you know that information, you can plan your payments and spending for the year ahead more efficiently.
You can factor your tax bill into your outgoings and therefore create more accurate forecasts and protect your cash flow more effectively.
Although, a note here! Ideally, you’ll already have a rough idea of how much you owe, and be setting enough aside to cover it. This is much easier to do if you use bookkeeping software which keeps you up to date on your current tax liability using your bookkeeping figures
Faster access to tax refunds
If you’re due a refund (otherwise known as a tax rebate), you’ll receive it sooner if you submit your tax return early. So, if you have everything you need to file your return, this is a great reason to get it done in good time. It’s particularly common for those who work as a subcontractor!
You’ll never miss the submission deadline
This one goes without saying but when you submit your tax return early, you’ll never be at risk of missing HMRC’s notorious deadline.
In case you need a reminder: the deadline for your online tax return is midnight on January 31st for online returns, or October 31st for paper returns. If you do miss the deadline, you’ll receive a late filing penalty of £100. The penalty amount increases the longer you leave it. You will also receive a separate fine for late payment of your tax bill.
Tips on how to prepare for an early tax return submission
If you are going to get yourself ultra-organised and submit your tax return early, we’ve got some tips that will help you get well-prepared.
Keep good bookkeeping habits all year round
Thorough bookkeeping is the bedrock of successful accounting, especially when it comes to completing your Self Assessment tax return. If you stay on top of your accounts and keep them up to date all year-round, the tax return process should be a breeze.
Set time aside to dedicate to the task
This might seem like a simple suggestion but you truly can’t underestimate the value of undivided focus when it comes to doing your tax return. Remove yourself from any other distractions and concentrate on the task at hand to avoid unnecessary stress or errors.
Collect all the information you need beforehand
Write yourself a checklist of things you’re going to need for your Self Assessment before you sit down to complete your tax return so you’re organised and equipped. This includes things like your National Insurance number and your Unique Taxpayer Reference (UTR).
Seek help from an expert accountant
Although completing your tax return yourself is entirely possible, the (many) benefits of hiring an accountant to do it for you are invaluable. Leaving it to the professionals will save you significant time and will remove the responsibility so that you can concentrate on other matters, like growing your business.
If hiring an accountant all year round isn’t something your budget can accommodate just yet, don’t worry – many accountants will offer an ad hoc service that just covers your Self Assessment tax return for a flat fee.
Our advice is to shop around for an accountant, and do your research to find the right support to meet your needs (and spending limits).