Vital tax advice for Trades and other self-employed workers

Get your diary ready. There are some key tax deadlines on their way and if you miss them … you’ll be paying a small fortune. In this blog, we’re going to look at these deadlines and find out why they might matter for you and your business.

The first few dates have already been and gone but they’ll still count for next year. So, pop them in your diary – today!

31st July – payment on account due

Are you self-employed and do you pay your tax through payment on account? In which case, 31 July is the deadline for your second payment. The amount you pay is an estimate, based on your earnings for 2017-18. If you still owe tax (for example, if you earned more in 2018-19), you’ll need to pay a further ‘balancing payment’ on 31st January 2020. This is when you’ll also have to make your first payment to cover the 2020-21 tax year.

5th October 2019 – register for self-assessment

Are you new to self-employment? Is this the first time you’ve submitted a self-assessment tax return? Then, you should have registered by 5th October 2019 in order to make the submission for the 2018-19 tax year.

31 October 2019 – paper tax returns due

Do you still file your tax returns on paper? Then this was the deadline for filing your return. If you missed this deadline then all is not lost. You can still complete an online tax return instead (these are due on 31 January 2020).

30 December 2019 – opt into PAYE

Do you file your tax returns online and also have earnings taxed under PAYE? Then, you can choose to have overdue tax collected via PAYE. But, for this to be allowed, your tax bill must be below £3,000 and you must file your online return by this date. The advantage of this is that any tax payable would be paid over 12 months from April 2020, rather than in a single lump sum by 31 January 2020.

31 January 2020 – online tax returns due

This is the big one! The final deadline for your online tax returns – HMRC must receive your tax return by midnight. The only time this deadline may not apply is if you receive notice after 31 October 2019 from HMRC to make an online tax return. In this case, you have three months from the date of issue. The deadline to pay your tax bill is also 31 January.

Fines for being late with your tax returns – and it doesn’t make pretty reading!

File your tax return late, or fail to pay the tax you owe on time, will almost certainly mean you face penalties and interest charges. Here are the charges you’ll face –

1 day late – £100 for one day after the deadline

Up to 3 months late – £10 for each additional day (capped at 90 days), plus £100 initial fine – maximum of £1,000

6 months late

Either £300 or 5% of the tax due (whichever is higher), on top of the penalties above

12 months late

An additional £300 fine, or 5% of the tax due, plus the above penalties. In the most serious cases, you could be fined 100% of the tax due

How do I submit my 2018-19 tax return

If this is the first time you’ve submitted a tax return, you’ll need to register with HMRC. You can do this online. Once you’ve registered, you can choose from two ways to submit your tax return to HMRC –

  1. You can send a paper tax return
  2. You can fill in an online tax return

Option 2 has numerous advantages, but the best way to find out what these are is to give us a call.
We’re here to help and we relish the chance to chat to you about any accountancy or tax issue that you might have. We’re your friendly, efficient and affordable specialist bookkeeper/accountant for the trades sector.

Call us – 01604 700020
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It would be great to hear from you.