9 THINGS TO REMEMBER WHEN FILING YOUR TAX RETURNS | It’s easy enough to remember to file your tax returns every year – the HMRC does everything in its power to make sure that those brown envelopes continue to drop onto your doormat with alarming regularity.
If you prefer to do your own returns, submitting them online has made the process that much easier and quicker. However, the more preparation you can do in advance, the less chance you will have of making any mistakes that could end up seeing you paying out more than you actually owe.
Our ten tax return tips are a simple checklist that will enable you to avoid any costly mistakes, and could actually save you hundreds in unnecessary outlays.
- Not including your signature and the date
You must sign your tax return and include the date that you file it. It might seem like a really simple thing, but you’d be surprised how many people forget this one thing.
- Make sure your numbers are correct
There are two important numbers that are included on you tax return – your NI National Insurance number, and UTR Unique Tax Reference. It’s very easy to get these numbers wrong when you enter your details. The wrong details could mean that your tax payment ends up being accredited to the wrong person, and although that can be rectified, it is a lot of hassle! So double, triple check your numbers!
- Falsely claiming expenses
The rules pertaining to what you can and cannot claim back as expenses are complex and complicated. If you make a false claim, even if it was unintentional, you could end up with a hefty penalty. The golden rule is, if in doubt, check with a professional! But even if you’re sure, check with a professional anyway!
- Not including ALL forms of income
When completing your tax return, you need to make sure that you include ALL sources of income. The primary source is probably your salary. But you also need to include all of the following if they relate to you: dividend payouts resulting from any shares you hold in limited companies; any bonuses paid as a result of employee share schemes; any interest or dividends paid on bank and building society accounts, investments, Trusts, and others; and rental income on properties you may own; any capital gains on property or investments you may have sold; and benefits; any pension income, any income from overseas sources. Again, failure to declare any income will result in penalties, which can be quite hefty depending on the sums involved.
- Inputting incorrect figures
If your calculations are wrong, you could be liable for prosecution. If figures are not your strong point, get a professional to look over your figures. Sometimes you get too close to it and need a fresh pair of eyes to look over them.
- Missing deadlines
There are very clear deadlines that do not change from year to year. There is no excuse to missing the deadline, and doing so will make you immediately liable for a penalty.
- Not keeping the right records
You need to be able to back all your figures up with the right records. You have a legal responsibility to keep a record of all business transactions.
- Ticking the wrong boxes
Ticking the wrong box may lead to penalties. Make sure you thoroughly and carefully read each section every step of the way.
- Missing out on vital information
You have one chance to make your submittal. You can not go back and amend it. You cannot write ‘info to follow’ in the more information sections. Take your time, gather the information, complete it over the course of a few days/weeks, and make sure that every bit of information is in place when you hit the submit button.