Five Benefits of Completing Your Self-Assessment Tax Return Early
We’re very much at the beginning of the new financial year and you’re probably feeling as if you have all the time in the world to file your self-assessment tax return. You may even be one of the 735,258 taxpayers who filed their last tax return on 31 January this year, just hours before the HMRC deadline. Why would you even consider filing it now when you don’t need to do it for months?
Well, there are actually some very good reasons:
1) Proof of Income
If you want to buy a property and need a mortgage, or you need to re-mortgage or change the one you have, then completing your latest tax return will be one thing you can tick off your list. When a mortgage company is poring over your finances, they will expect to see two or three years’ proof of income, so having your return up-to-date will give you a head start on the paperwork.
2) Manage Your Cashflow
The sooner you fill in your tax return or have your accountant do it, the sooner you’ll know what you need to pay in tax at the end of January. This ensures you have time to plan and allocate funds to paying your tax bill, rather than trying to find a large sum of money in a short space of time.
3) Claim Your Tax Refund Early
It goes without saying that the earlier you submit your self-assessment, the earlier you are likely to receive any tax rebate due to you, especially as HMRC won’t be dealing with as many claims at the same time.
If you are a builder, plumber or electrician then you already know that people in your profession often receive tax rebates. So why wait until next year to receive your tax rebate, when you can enjoy it now.
4) Claiming Tax Credits
If you receive Tax Credits or other means-tested benefits you are probably aware that you have to renew your claim every year by 31 July. Although you can offer estimated figures, it makes sense to provide HMRC with evidence and accurate figures in order to avoid complications or the risk of having to repay money later in the year.
5) Increase your accuracy and reduce your stress
Leaving your tax return to the last minutes and then rushing it can lead to errors and omissions as well as being extremely stressful. Mistakes may end up costing you money, either through lost tax relief that you are entitled to or, worse, a fine from HMRC for leaving out something really important.
Finally, if you’re using an accountant to file your tax return, then one altruistic benefit to being ahead of the game, is to make their life a little easier…they’re the ones trying to save you tax after all.
At Lewis & Co we have been helping businesses, sole traders and individuals make the most of their income for 30 years. If you would like to speak to one of our team, please contact 01892 513515 or email info@lewisandco.biz
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