Tax Return
A Tax Return 2019 covers the tax year 6 April 2018 to 5 April 2019 (2018-19)
If you receive a tax return, you are required by law to fill it in. The tax return will ask you for any taxable income and capital gains. HMRC uses this information to calculate your tax bill or possibly a tax refund.
The tax return only needs to be completed once a year and to be submitted by a certain date not to incur any financial penalties.
A paper tax return is sent you each year around April. HMRC will send in the post to those that have submitted a paper tax return in the previous year. It will be addressed personally to you with your tax reference number.
Today the trend is more people are filing online. There are certain steps to take in order to submit online.
The tax return will have sections to complete for all your income and claims.
It starts off with employment , self employment , partnesrship. Most people filling in a tax return will be self employed and directors of limited companies. The majority of the workforce are in full or part time employment and have their taxes deducted at source under the PAYE scheme and will not be required to fill in a tax return.
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Who is likely to receive a tax return ?
Self employed and directors of companies. It is HMRC’s way of collecting income tax from this group individuals.
Easy enough to fill in but you must organise yourself and have certain amount of information ready.
Most self employed, in our experience, are not well organised in their accounting records, concentrating on their day to day work and leaving the paperwork till last.
Professional Bookkeeping Services (PBS we have specific packages aimed at the small client to keeping good records during the year at a very small fee, can start as little as £40 per month.
Adequate and accurate records are necessary in order to fill in the relevant section on the tax return
What information will be requested to fill in tax return?
Personal details such as date of birth, phone number and your national insurance number.
The tax return will ask for all your taxable income and gains for the year. You may also have to complete additional forms such as self employment.
The first 3 sections are 1. Employment 2. Self employment 3. Partnership
If you tick the box self employment on the tax return , this will require you to fill in a self employment form.
The more simplified version is called SA103s when the annual turnover is less than £83,000.
This is a 2 page form showing income and expenses with net profit or loss.
This form will need to be sent back to HMRC along with the tax return.
What are the allowable expenses ?
The allowable expenses as listed on HMRC self employment form are :
- Cost of stock you bought to resell
- Car and travel expenses
- Wages, salaries and other staff costs
- Rent , rates, power and insurance costs
- Repairs and maintenance
- Accountancy , legal and other professional fees
- Interest, bank and credit card charges
- Telephone, fax stationery and other office costs
- Other allowable business expenses
HMRC will not ask you to send proof of your expenses like receipts or invoices but it is important that you keep all your records for up to 6 years from your last tax return in case HMRC ask you to produce them.
Yes, more tax returns are now filed online instead of paper form
Yes the process of filing online is easy but you have to be organise yourself first and have all the information ready to insert on the forms.
Yes but for the sake of a small fee once a year it is better to let a professional firm to it.
To avoid errors , omissions and other inaccuracies.
To complete and submit the late tax return without any further delay because the penalty continues to accrue. It start at £100 and then a daily rate of £10 kicks in.
To complete a tax return will cost £100 to £150 depending on the number of entries to include on the tax return. Most accountants will charge £300 to £350 for the same work..
