insideKENT Magazine Issue 55 - October 2016

BUSINESS TAX RETURNS: THE ONLINE DEADLINE by Paul Nixon of Wilkins Kennedy DEADLINE FOR PAPER TAX RETURNS IS MONDAY 31ST OCTOBER SO IT IS CATCHING UP FAST. AFTER THAT TIME, YOU WILL BE ABLE TO SUBMIT A RETURN ONLINE UNTIL THE DEADLINE OF 31ST JANUARY, BUT WITH A BUSY QUARTER UP AHEAD, NOW IS AS GOOD A TIME AS ANY TO GET PREPARED. According to HMRC some of the worst excuses for not filing returns on time last year, included a rat eating the necessary tax papers, an untidy house and an argument with a significant other. But all joking aside, by mid-January this year, some 5 million people had still not filed their returns in time for the January 31st 2016 deadline – and with around 11 million people needing to do so, time is ticking to make sure the same mistakes are not repeated this year. Who needs one If you are self-employed then you will need to file a tax return. Even if your self-employment is not a full-time occupation, for example, if you run a part-time business or a property portfolio, you will still need to be prepared. HMRC will contact you if you are required to fill in a tax return, but you can also check out your status online here: www.hmrc.gov.uk/sa/need-tax-return.htm No income? No escape! Don’t think that you will not be required to file a tax return, just because you didn’t do any trade or you didn’t make any income from a businessrelated venture. The clue is in the title – Tax is collected on a self-assessment basis so you cannot rely on HMRC to ask for a tax return or they can ask for a return even though technically you do not need to file one – and ignorance is no excuse! You can check whether you need to file a tax return at www.gov.uk/self-assessmenttax-returns/who-must-send-a-tax-return. Even if you don’t owe any tax you can’t escape a fine if you miss the deadline – you will be hit with £100 penalty, with additional penalties the longer you leave it. So, even if you don’t owe anything, you will still need to file your return. Going paperless If you are away on the date that the paper deadline falls, don’t panic – you can still submit a return online. In fact, online submissions are being actively encouraged by the Government in their efforts to go digital. In November 2014, HMRC announced plans to launch a digital platform as part of its digital strategy. It is designed to offer any business, but particularly SMEs, more flexibility to keep tax information up to date, so that when it comes to filing returns at year-end, it should be much easier to do so. It is also part of the Government’s plans to close down any loopholes in trading where undeclared income has previously been overlooked. More than 9.24 million people chose to use HMRC’s online tax return service in January 2016 – around 89%. However, don’t think that letting the paper deadline pass you by is the easy option. It may seem a way off, but it is not unusual for time to run away with us. The online deadline can interfere with preparation time as Christmas and New Year holidays get in the way. So, it is paramount that if you haven’t done so already, your tax return must be filed as soon as possible. If you need another reason, bear in mind that many tax payers will leave their submission to the last minute, which could make filing yours tricky if you choose to do the same. January 29th 2016 was the busiest day for online tax returns this year, with 513,271 returns completed – that’s 21,386 per hour! The busiest time was between 2pm and 3pm with 14 per second clicking ‘submit’. Filling in a selfassessment form can be a time consuming process, but by working efficiently in the final hours before the deadline you will only give yourself a fighting chance of getting it done on time. Top tips for getting there 1. Don’t confuse your UTR (Unique Tax Reference) with your National Insurance number – make sure you use your UTR number in the Tax Reference field 157 2. Reaching the calculation page does not mean you have submitted your return – keep going until you have re-entered your user ID and password. If you have lost these, you can request replacement credentials from www.hmrc.gov.uk/onlinehelp 3. Read up on the things you can claim for – there could be tax reliefs available Prep your accountant!

insideKENT Magazine Issue 55 - October 2016 | Page 157