For anyone who completes a self-assessment tax return, it is easy to let it drift to the back of your mind for most of the year. The deadline feels a long way off; other things take priority and before you know it you are scrambling to pull everything together at the last minute.
The trouble with leaving it late, is that self-assessment rarely goes smoothly under time pressure. Documents go missing, figures get rushed and the whole process becomes far more stressful than it needs to be.
Preparing well in advance changes all of that. Here is what to think about to make your next self-assessment as straightforward as possible.
Documents you’ll need
Before a tax return can be completed accurately, you need to have the right information in front of you. Depending on your circumstances, this is likely to include:
- P60 or P45 details if you were employed at any point during the tax year
- P11D details for any benefits in kind, such as a company car or medical insurance
- Records of self-employment or freelance income, including invoices raised and expenses incurred
- Dividend vouchers or statements if you receive dividends from a limited company
- Bank interest statements
- Details of any rental income and associated property expenses
- Pension contributions, particularly if you want to claim higher rate relief
- Records of any capital gains, such as the sale of shares or a second property
- Gift Aid donations, if you want these included in your tax position
Gathering all of this in one place before you start makes the whole process far quicker, and it also reduces the chance of something being missed by accident.
Common mistakes
Self-assessment is not especially complicated in principle, but it is easy to trip up on the detail, particularly if it is being rushed. Some of the most common mistakes include:
- Missing income entirely, such as small amounts of interest or a one-off freelance payment
- Forgetting to include income from a source that has since closed, such as a savings account no longer in use
- Claiming expenses that are not actually allowable, or missing ones that are
- Entering the wrong figures for dividends or pension contributions
- Underestimating payments on account and being caught out by the amount due
- Missing the registration deadline for anyone completing self-assessment for the first time
- Simply missing the filing or payment deadline altogether
Most of these mistakes are avoidable with a bit of organisation and enough time to check things properly, rather than filling in a return under pressure the night before it is due.
Why early preparation helps
Filing early rather than at the last possible moment has real, practical benefits, beyond simply avoiding stress.
- You know what you owe sooner – the tax due does not change based on when you file, but knowing the figure early gives you far more time to plan for the payment.
- There is time to fix problems – if a document is missing or a figure looks wrong, there is room to sort it out calmly rather than under deadline pressure.
- It reduces the risk of errors – rushed returns are far more likely to contain mistakes, which can lead to unwanted attention from HMRC or an inaccurate tax bill.
- You avoid the January rush entirely – accountants and tax advisers are at their busiest in the run-up to the deadline. Filing earlier means more time and attention can be given to your return.
- It gives you a clearer overall financial picture – knowing your tax position earlier makes it easier to plan cashflow, savings or any other financial decisions for the rest of the year.
There is no advantage to leaving self-assessment until the last minute. The tax owed is the same whenever the return is filed, so the only thing being gained by waiting is unnecessary pressure.
How an accountant can help
Self-assessment can be completed without professional help, but for many people, particularly those with more complex affairs, working with an accountant makes the whole process considerably easier.
An accountant can help by:
- Confirming exactly what income and information needs to be included
- Identifying allowable expenses and reliefs that might otherwise be missed
- Calculating figures accurately, including anything more complex such as capital gains or pension tapering
- Managing deadlines, so nothing is forgotten or filed late
- Advising on payments on account and helping you plan for what is due
- Flagging any planning opportunities that could reduce your tax bill for the following year
Beyond simply completing the return, a good accountant will also help you understand your tax position rather than just handing you a figure to pay. That understanding tends to make future tax returns easier too, since you go into the process already knowing broadly what to expect.
Preparing early, staying organised and getting the right support all make self-assessment a far less stressful part of the year. If you would like some help getting ready for your next tax return, we would love to hear from you. Call us on 01173 700 079 or drop us an email at hello@steppingstonesaccountancy.co.uk and we can talk through what would work best for you.
