If you don’t have your tax deducted at source through pay as you earn, you’ll likely be familiar with self-assessment tax returns. If you fall into one of the below categories, you may need to submit an annual self-assessment tax return to HM Revenue & Customs so they can send you an accurate tax bill based on your earnings, so you pay the right amount of tax.
- Limited company director receiving untaxed income such as dividends
- Self-employed as a sole trader and earning more than £1,000
- Partner in a business partnership
- Employed and earning more than £100k
- Earning over £50k and receiving child benefit
- A higher or additional rate taxpayer and paying into a personal pension
- Earning untaxed income such as dividends
- Receiving income from property
Even if you’ve previously completed your own self-assessment tax return, it can still be a daunting and stressful – not to mention time consuming – task. Tax laws are complex and ever-changing so it’s hard for self-employed people to keep abreast of the changes and ensure compliance.
There are numerous benefits of appointing an accountant for tax return purposes which we’ll explore further in this post.
Avoiding Attention from HMRC
If you submit your self-assessment tax return with errors or inaccuracies, or if you miss a submission deadline (31st January for online returns, 31st October for paper returns), it’s likely that attention from HMRC will be forthcoming and that is something everybody wants to avoid.
The penalties for submitting your tax return late are:
- 1 day late – You must pay a penalty of £100
- 3 months late – You can receive a penalty of £10 a day for a maximum of 90 days (£900)
- 6 months late – You can receive a further penalty of 5% of the tax you owe or £300, whichever is greater
- 12 months late – You can receive a further penalty of 5% of the tax you owe or £300, whichever is greater. It’s possible that you have to pay up to 100% of the tax you owe
The penalties for paying your tax late are:
- 30 days late – You must pay 5% of the tax you owe at that date
- 6 months late – You must pay a further penalty of 5% of the tax you owe at that date
- 12 months late – You must pay a further penalty of 5% of the tax you owe at that date
Penalties for errors and inaccuracies in your self-assessment tax return are derived using a behaviour-based system which is outlined below.
- If the error is due to a lack of reasonable care, the penalty will be between 0% and 30% of the extra tax due
- If the error is deliberate, the penalty will be between 20% – 70% of the extra tax due
- If the error is deliberate and concealed, the penalty will be between 30% – 100% of the extra tax due
You can appeal any penalties once you’ve submitted your return to HMRC, but this can be a time consuming process.
Appointing a accountant to handle your self-assessment tax return will help take the pressure off you and massively reduce the chances of any errors in your submission, or of it being late. An accountant who regularly handles tax returns will be familiar with the process and will ensure your return is completed smoothly and in a timely manner.
They will also be up-to-date with all the latest tax law developments and will have a comprehensive understanding of all tax regulations and allowances, as well as the pitfalls and issues that can lead to penalties, helping ensure your submission will be error-free. Leveraging this expertise is invaluable for self-employed people to reduce the risk of penalties.
Save Time and Stress
Completing your self-assessment tax return yourself means investing significant time, effort and it can be very stressful, especially if the deadline is looming! If you tackle it yourself, you’ll need to collate all required information and documentation, understand things like deductible expenses, tax codes and allowances, and complete the return before submitting.
If you delegate your self-assessment tax return to an accountant, your return will be quickly and expertly handled. An accountant will have completed many returns before and will have expert knowledge of HMRC’s systems ensuring a smooth and pain-free submission process.
Ultimately this will unburden you and save you a lot of time and stress. Your submission will be in the hands of an expert who will take care of the entire process for you giving reassurance and peace of mind that your tax affairs are in order.
If you’re a new start-up the time saved can be spent focusing on business growth or other core activities. Or maybe you’ve been working long hours… The time saved by getting an accountant to handle your self-assessment tax return could be spent on rest and recuperation, hobbies or family time.
You Could Save Money
Although there will be a cost to get an accountant to prepare your tax return, this can often be more than offset by cost savings they can identify for you. An accountant will possess thorough and in-depth knowledge of tax reliefs, exemptions and allowances that the average person completing their own self-assessment tax return would probably not be aware of.
It’s an accountant’s job to know tax legislation inside-out and, as such, they are able to identify where you can reduce your tax liability by taking advantage of any deductions and incentives. Ultimately, this can result in you saving more than the outlay to have your self-assessment tax return completed.
They can also offer expert advice and guidance beyond submitting tax returns. If you appoint an accountant to handle your business finances, they can support you with all aspects and develop a financial strategy to support long-term growth and success.
Working with Gorilla to complete your self-assessment tax return
Appointing an accountant for tax returns has many benefits for your self-assessment tax return submission including accuracy, time and potential cost savings and minimising the risk of any penalties.
Gorilla are expert accountants with a wealth of experience handling tax returns for self-employed people and we’ll do all the legwork for you. Our dedicated self-assessment tax return service will handle the whole process from start to finish and our prices start at £200 +VAT for a basic tax return.
If you’d like to appoint us for your self-assessment tax return, you can complete our Personal Tax Questionnaire here. If you have any questions regarding your tax return you can speak to an accountant on 0330 024 0406 or request a call back here.
