When the deadline for your income tax return is approaching, it’s important that you’re already organised in terms of preparing the necessary accounting paperwork on time, as you will receive a financial penalty from HM Revenue and Customs should you fail to comply.
The arduous task of ploughing through an increasing amount of red tape and legislation may seem daunting – but it’s crucial that you understand the procedure, as this is an area where you can save costs if you have the relevant knowledge to hand.
Read on for some advice on how to manage the countdown to your income tax return.
- It may seem obvious, but make sure you know the deadlines: submitting a tax return on paper must be done by 31st October, but you can do your tax online up to 31st January.
- Take advantage of capital Gains Tax: capital gains under £11,100 in the 2016-17 tax year are tax-free, while married couples and civil partners who own assets jointly can claim £22,200.
- If you run your own business, the annual investment allowance allows you to claim for capital expenditure for items such as computers and tools. Claim relief on up to £200,000 a year from January 2016.
- Self-employed people can claim tax-deductible expenses, including cash expenditure.
- Self-employed car costs: claim for the car’s running costs, but not the cost of purchasing one.
- Carry forward losses from one year to offset them against profits from the following year if you’re self-employed.
- Use your tax-free ISA allowance, with an annual limit of £15,240 from 6th April 2016.
- Transfer assets: You can transfer investments and savings to your husband, wife or civil partner to make savings if they pay a lower tax rate than you do.
- Dividend allowance: The first £5,000 that you receive in dividends from investments is tax-free.
- Making a donation to charity via Gift Aid can reduce your taxable income.
It’s vital that you don’t miss the deadline for submitting your tax return or paying your bill. There’s a financial penalty if your tax return is up to three months late – and the penalty increases if your tax return is submitted later than this, or if your tax bill is paid late.
Here at BC Sunderland Driver, our professional team can ensure your tax returns are always submitted on time – and what’s more, we can help you to save money by ensuring you comply with the necessary legal tax obligations, while at the same time paying the minimum amount of tax required.
Based in Keighley, we specialise in assisting business owners manage their tax affairs and make the most of the allowances available to reduce their tax bills.
We have the expertise to ensure small businesses, such as those in the manufacturing and engineering sector, comply with the law. We can advise on your business’s most tax-efficient structure.
Our services are aimed at helping you to build a better business, so let us do the hard work for you. Contact us today for advice on how we can help.