July tax deadline approaching
Whilst this year’s Budget brought good news that the Chancellor is planning to abolish the tax deadline for most people and make the self assessment system more user friendly, as long as the current tax system prevails, there will always be a mad rush at certain times of the year.
Payments on account are the ones that catch people out most often as they are not publicised as widely as those which are due on the self assessment deadline in January.
For those who are self employed, July 31st means making payments on account which will count towards their tax bill for next year, and also include Class 4 National Insurance Contributions. Despite what the Chancellor said in March about the proposed changes to the tax system, these changes have not yet been implemented and self employed individuals will need to carry on completing the paperwork and paying their tax bills as they were before.
Anyone who is not paid through a PAYE scheme and is not being taxed at source will need to complete the self assessment process, even if they don’t believe they need to pay any tax. The July deadline for payments on account is based on a predicted liability based on the previous year’s tax bill, so if you believe that your earnings will be significantly different, then you can contact HMRC to ask them to reduce the payment that they will ask for on account. This is a relatively simple process as you can either log in to your online account and click ‘Reduce Payments on Account’, or you can complete form SA303 and send it in to your tax office.
Anyone who has paid more than they owe on account will be issued with a refund, but if you fail to pay what you are owed then you could be liable for fines and penalties, so it’s always best to be absolutely sure.
Anyone considering working for themselves will find our take-home pay calculator helpful when it comes to working out what they could be earning. We also have a range of guides designed to help you understand everything from the intricacies of IR35 to the Flat Rate VAT Scheme.
If you want to stay ahead of the game when it comes to tax and ensure that you never pay too much or too little, then an expert accountant is the best way to keep your finances in order. To speak to one of our specialist accountants about your options, call us today on 01442 275789 or email email@example.com for details of our low-cost packages.