Preparing your business for your Tax Return - Boffix

Preparing your business for your Tax Return

December 19, 2017  /  Amber Elliott
Boffix Tax Return Blog

Talking about your Tax Return the week before Christmas is a drier subject then having your Christmas Dinner without gravy. But the longer you leave it the drier the taste gets. So why not get ahead before Christmas and New Year and get cracking on this crucial part of running a business.

The run up to Christmas

The run up to Christmas is a very different experience for an employee compared to a business owner. As an employee you may have already stopped work for a couple of weeks, or you may be enjoying the festivities in the office. But as the year ends, the small business owner is still in a battle with time. They are scrambling around trying to get their business into a position to close for a few of days over Christmas. They are still competing for those last-minute shoppers, trying to keep employees and customers happy, and juggling family commitments.

For most of us the very thought of the Big Day is pushed far from our minds. And add to that pressure of the Tax Return and we feel like our brains are going to explode. But that doesn’t need to be the case. The Tax Return doesn’t need to be stressful or worrying, you just need to prepare yourself and get it done.

So instead of looking at the tax return as the straw that broke the camel’s back, let’s look at it for what it is and ways to mitigate the fear around it.

Who needs to do a tax return?

Anyone who is self-employed, owns a rental property or who earns more than £100k a year. If you received Child Benefit and earn over £50k you also need to complete a return. If you fall into any of those categories you need to submit a return.

When is the Return due and how is it submitted?

There are two ways to submit a return. The paper return, however the deadline for that was 31st October last year and online with HMRC by the 31st January 2018.

If this is your first time completing a Return you will need to be register with HMRC, this process takes approximately 7 working days, so factor this into your timeline.

What information is required to complete a tax return?

Here are some of the documentation you will need to complete your return.

  • P60 – relates to employment income and tax deductions
  • P11D – relates to expenses and benefits
  • Personal income
  • Business Bank Statements, receipts and sales invoices
  • Savings – interest accrued on your savings accounts
  • Capital Gains relating to assets such as shares & sales of properties

How do you pay what is owed?

You can opt to pay the amount in full or spread it over the year through your tax code if you meet the requirements. However, if you are unable to pay the tax owed there are options available to you. Visit the HMRC website or speak to your accountant to get advice

Don’t ignore the problem, it will only get bigger

The Tax Return is one problem that will not go away. If you fail to submit it on time you will receive a fine. If you fail to pay you will receive a fine. Like everything else in life this is a grown up, life problem and one that needs your attention.

Here are some suggestions on how best to tackle the Tax Return:

  1. Don’t stress or worry about it otherwise you won’t be able to logically think about what needs doing.
  2. Get together all the documentation needed – you will feel much better once you have all the information to hand.
  3. If unsure about what you are doing, ask for help.
  4. If you have an accountant use them, that’s what you pay them for.
  5. If money is a problem, gather all the information yourself into a spreadsheet and get an accountant to calculate the tax owed.
  6. Start as soon as possible, the sooner it is done the sooner you can relax.

If you are still unsure or completely overwhelmed contact Boffix. They have a team of accountants waiting to help you. They are specially trained to handle and manage small business accounts. Plus, their price plans have been developed with the small business in mind, so it won’t cost you the earth. If you can get as much of this sorted before Christmas, you will be able to take a couple of days off without the worry of having to face it in the New Year.

Next Week: New Year’s Resolutions for the Business Owner

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