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The past few years have seen increasing numbers of people filing their tax returns early – in 2023 more than 246,000 submitted their tax returns between 6th to 12th April. Below, we explain why...

Receive your tax refund earlier

There are many reasons why you may be due a tax refund, including excessive payments on account based on the previous year's income, and for employees and directors where HM Revenue and Customs (HMRC) have made errors with their tax codes. Building subcontractors who have had tax deducted at source through the Construction Industry Scheme (CIS) are often in a tax refund position.

Therefore, the sooner you file your tax return, the sooner any refund you may be due can be processed.

You don't have to pay your tax bill early 

Calculating your tax liabilities and filing your return now will allow you time to start budgeting and managing your cashflow so you are ready to make your tax payment. You can plan for paying any tax you may owe by the deadline of 31st January. Filing your tax return early doesn't mean you have to pay your tax sooner. 

Pay your tax through your tax code 

If you owe less than £3,000 in tax and file your tax return before 30th December, you may be able to opt to have your tax liability collected through your tax code. This can be a great option to spread the cost and ease the pressure on your cashflow. 

Get friendly and local tax return help

Contact TaxAssist Accountants for a free, no-obligation consultation.

020 3981 8102

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Calculate your tax bill for cash flow planning

Many businesses are trying to forecast their cash needs in the short/medium term and one of the biggest expenses the self-employed will have will be their income tax bill.

Knowing exactly how much tax will be due by 31st January will help you to plan effectively. You can arrange how you will be able to pay it, be that through bank funding or by preparing to engage with HMRC and asking for a phased payment arrangement when the liability falls due.

Remember, just because you file your return early does not mean that you must pay the liability immediately. Regardless of when you file your tax return, the tax won't be due until 31st January 2025.

Have more time to focus on your business

If business is quieter for you at the moment, your income tax return is a task that you could get done and out of the way. Otherwise, plan it in your calendar for a quieter time, perhaps this is before the Summer season or just after.

This means that when business is busy you won't need to be juggling that alongside getting your tax return ready. Leaving you with more time to focus on business instead of your tax return.

More time to prepare

The more time you give yourself to gather all the information you need to prepare your tax return, the better. This should reduce the risk of errors and mistakes being made, which may not only be costly, but could also mean you end up paying more tax than you need to and having to re-submit your tax return.

More time to plan for any tax savings 

If your affairs have changed this year, for example you've made a significant amount of additional profit, preparing your tax return early may reap rewards. It gives you the time to consider any tax planning opportunities which could lead to tax savings. 

Avoid penalties and late payment interest

If you file your tax return late, you will be issued with an automatic £100 late filing penalty. If your tax return becomes more than three months late, £10 daily penalties start to accumulate up to a maximum of £900.

A penalty of the higher of £300 or 5% of your tax due is then charged if your return is six months late and again if it becomes over 12 months late. All of these penalties are in addition to one another; rather than in place of. This can mean penalties for late tax returns can top over £1,600.

Collecting the right amount of Tax Credits 

If you are in receipt of tax credit or benefits, your claim needs to be renewed annually by 31st July, which involves letting the Tax Credit Office know your income. 

While you may submit temporary estimates, it is preferable to submit the actual figures as soon as possible to avoid you being over or underpaid until the Tax Credit Office has received your actual figures. 

How we can help

TaxAssist Accountants can help you complete your tax return early, so you know how much tax needs to be paid and by when.

If you are due a tax refund, it makes great sense to receive this as soon as possible. We work with many self-employed individuals and business owners and we can help you too.

If you need help with your self-assessment affairs, call us today on 020 3981 8102 or drop us a line using our online enquiry form.

Need support with your tax return?

Contact TaxAssist Accountants for a free, no-obligation consultation.

020 3981 8102

Or contact us

Frequently Asked Questions

If you miss the deadline for your self-assessment tax return, it's important to speak to your accountant or HMRC as soon as possible. The sooner you rectify the issue and get the tax return filed and tax paid the better.  

If you are late, you'll receive an automatic late filing penalty. You'll also be charged interest on late tax payments. 

Self-employed individuals, partners in business partnerships, landlords and individuals earnings over £150,000 may be required to file a tax return. Those in receipt of child benefit and earning over £60,000, or higher rate taxpayers earning interest income over £500 may need to complete a tax return too. For a comprehensive list check HMRC’s content on who must send a tax return.

For those that use Revenue Online Services (ROS) the pay & file deadline is Thursday 14 November 2024.  

Tax Credits reduce the amount of tax that you pay. The tax credits you are entitled to are dependent upon your personal circumstances.

Another great way to save money on your tax bill is to pay into a pension. The government offers generous tax relief at your highest tax rate. 

Here are 10 ways to save money on this year’s tax return.

Date published 26 Mar 2020 | Last updated 8 Oct 2024

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

Catherine Heinen, FCCA

Catherine is a Technical Content Writer at TaxAssist Accountants, and a qualified accountant. With experience working at two accountancy practices in the UK top 50 accountancy firms according to Accountancy Age, Catherine has significant experience in accounts, tax returns and advising clients. Catherine ensures businesses, business owners and individuals are kept up to date and informed by providing concise and informative technical material.

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