Critical tax advice for Trades and other self-employed workers
It’s time to get that diary out. Key tax deadlines are on the horizon (one of them just a matter of days away). Missing them could prove to be a big mistake – one that costs you a small fortune. In today’s blog, we’ll check out these deadlines and analyse why they could be important for you and your business.
5th October 2020 – 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 need to have registered by 5th October 2020 in order to make the submission for the 2019-20 tax year.
31 October 2020 – paper tax returns due
Do you still file your tax returns on paper? Then this is the deadline for filing your return. If you missed this deadline then don’t worry. You can still complete an online tax return (due on 31 January 2021).
30 December 2020 – 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 2021, rather than in a single lump sum by 31 January 2021.
31 January 2021 – online tax returns due
This is the important one! The final deadline for your online tax returns – HMRC must receive your tax return by midnight on the 31st. The only time this deadline might not apply is if you receive notice after 31 October 2020 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 2019-20 tax return?
Is this the first time you’ve submitted a tax return. Then 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 –
- You can send a paper tax return
- You can fill in an online tax return.
Option 2 has many advantages, but the best way to find out what these are is to call us.
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
Or send us an email – firstname.lastname@example.org
It would be great to hear from you.