Phew! January 31st has passed, and the dust has settled. However, this doesn’t mean that you can’t get ahead of the curve when it comes to filing your tax return for next year!
As we enter the second quarter and business is starting to pick up, organising your paperwork can give you peace of mind and a complete visual of your finances.
We are looking at 5 ways to keep your business on the ball and how you can prepare for next year's tax return deadline.
1/ Get organised! Use an app to upload your receipt.
Business paperwork can be the biggest hurdle when it comes to completing your tax return on time. In between business reports, stock management sheets, and private team member information, receipts that are essential to your return can be outcasted as scrap paper.
HMRC recommends that all businesses hold onto records that indicate all sales and expenses, this includes:
Sales invoices (including till rolls and bank slips, if applicable)
Bank statements (along with chequebook stubs if you use this method)
VAT records (if you’re VAT registered)
Staff PAYE records (if you have any employees)
Expenses related to your business (such as travel and office costs)
Records of personal income
Keeping track of all this paperwork can be made a lot easier by downloading a business receipt app to your company (or personal) phone. This way you can end every week with a receipt collection and a photo session, making the process easier, quicker, and less stressful.
2/ Don’t leave it until the last minute! Begin pulling figures together in advance.
Just because there is a deadline, doesn't mean you can’t start making preparations now. With the business year already underway, now is the perfect time to compile your financial paperwork and organise them in a way that makes the most sense.
We recommend following the HMRC requirements as closely as possible, by labelling each of your invoices with a specific client or project number can make your filing system more seamless and more straightforward to send when the time comes.
Keeping on top of this system is also crucial to your preparation. Rather than waiting for monthly or quarterly catch-ups, begin the habit of updating these records weekly.
3/ Make a payment on account by the end of July! Create a clearer picture of what is due.
The 31st of July deadline, or the ‘Payments On Account’ deadline, offers a fantastic opportunity for a mid-year reflection on where your business is going and what needs to be done for the remainder of the year.
Each payment indicates half your previous year’s tax bill, so by submitting half of your payment on this day, your business can budget the rest of the expenses.
4/ Build a Budget! Budget for your tax bill.
For those who are self-employed, a BPP (Budget Payment Plan) makes managing the books straightforward. With monthly or weekly deductions from your income going toward your tax return, it can make issues such as deadlines and penalties a thing of the past. However, if you’re short on expected payments then charges can ensue and decimate your budget almost entirely.
We can assist you in setting up a personal budget to mitigate this issue and ensure that you are on top of your finances, even when the unexpected happens. This process may not take the sting out of tax payments, but it certainly makes the process a lot easier.
5/ Get an accountant who understands your business (like us!).
If all the above suggestions still leave you feeling uncertain about your tax payments, then let us give you a helping hand!
With almost 15 years of accountancy experience and 2,500 (and counting) tax returns under our belts, we have the knowledge to support you with your business's financial needs. We offer a variety of services such as calculating your company’s profits, identifying tax efficiencies within your business and processes, and saving you from paying the tax you ought not to be paying.
We can simplify the process completely and help you feel more confident every time January 31st rolls around.
Don’t leave it until the last minute. Talk to us today.