The Devil really is in the detail
There is no doubt this has been an extraordinary year and with regular announcements from HMRC, it can be difficult to keep track of what that means for your taxes. Don’t let the Devil in the detail catch you out – make a note of the important deadlines!
When it’s a challenge to keep income streams flowing, it’s more important than ever to avoid any penalties for late returns. Therefore now is a great time to ensure you have everything in place to submit your online self-assessment tax return by 31st January 2021. That’s the bad news, the good news is that you’ll have longer to pay. The even better news is that at the moment, we have a special offer to sort out your tax return for just £350! Furthermore, this charge is an allowable expense!
You don’t need to be a genius
The following text appeared in an Associated Press article in the New York Times titled “Tax Form Baffles Even Prof. Einstein” dated March 11, 1944. Asked what his reaction was to the maze of income tax questions, Professor Einstein, whose theory of relativity is supposedly understood by only seven persons in the world, replied:
“This is a question too difficult for a mathematician. It should be asked of a philosopher.”
Or an accountant! We can explain all things tax-related but to be fair, we don’t know a lot about the theory of relativity. However, regardless of whether you’re self-employed, employed, or a director of a limited company, your tax issues can be solved by us.
You can pay tax through self-assessment if you’re self-employed or through Pay As You Earn (PAYE) if you have an employer or both. If you’re self-employed, you must have registered yourself with HMRC by six months before the end of the tax year (i.e. October).
Self-assessment means that you (or your accountant) will have to complete a tax return for the year ending on April 5th and submit it before 31st January of the following year. If you don’t, you’ll face an immediate penalty of £100 and any further delays will bring further penalties.
Enhanced Time to Pay for Self-Assessment taxpayers
On 24th September 2020, as part of his Winter Economy Plan, the Chancellor Rishi Sunak announced an Enhanced Time to Pay for self-assessment taxpayers. Meaning that self-assessment customers could pay their deferred payment on account bill from July 2020, any outstanding tax owed for 2019 to 2020, and their first payment on account bill for this current tax year in monthly installments, up to 12 months, via the online payment plan service.
This means that the self-employed and other taxpayers have more time to pay taxes due in January 2021. Building on the deferral provided in July 2020, any taxpayers with up to £30,000 of self-assessment liabilities due will be able to use HMRC’s self-service Time to Pay facility to secure a plan to pay over an additional 12 months. As a result, self-assessment liabilities due in July 2020 will not need to be paid in full until January 2022.
However, there are some requirements such as, not having any outstanding tax returns or tax debts or any other HMRC payment plans set up. This facility does incur interest which will be applied to any outstanding balance from 1st February 2021.
Deferred VAT – New Payment Scheme
The government has also announced it will give taxpayers who deferred VAT payments between 20th March 2020 and 30th June 2020 the option to spread their payments over 11 interest-free payments in the financial year 2021-2022. This means that VAT liabilities due between 20th March and 30th June 2020 will now need to be paid by 31st March 2022. If you took advantage of the VAT deferral you will be eligible to use the New Payment Scheme but you will need to opt-in once HMRC have put a process in place in early 2021.
Rather than worry about whether you’re going to meet your tax deadline, why not let us take care of every aspect of your tax and VAT requirements? We’re specialists that can ensure you don’t incur penalties and only ever pay what you owe. From liaising with HMRC to submitting your return, you can relax knowing we’ve taken care of it all for just £350! Using our expertise, we will make sure you keep as much of your hard-earned income as possible.