Wednesday, May 25, 2022
Finance

Doing Your Own Taxes? 6 Tips to Help You in the Process

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A lot can happen in one year. You grow older and hopefully grow wiser as the sun complete another rotation around the sun. The seasons change, birthdays come and go and every one of the holidays, the ones you like and the ones you dislike, each get their turn in the spotlight. Almost everything people do is tied to this cycle of repetition… including your taxes.

No matter what country or part of the world you are from, the act of filing your tax isn’t a process known for its simplicity or ease. Britain is no exception to this rule. As the time to do your taxes returns once again, consider these tips as guideposts to help you navigate the tedious waters that are your taxes.

6 Tips for Anyone Doing Their Own Taxes

  1. Be prepared with all the necessary paperwork to properly file your taxes.

Trying to file your taxes without all the proper paperwork is like trying to run a race with your shoelaces tied. Ensure you have everything before you start to give yourself the best chance of finishing quickly and properly.

  • P60 form (income and tax)
  • P11D and P9D (expenses and benefits)
  • P45 (if you have changed jobs within the year)
  1. Avoid calling HMRC if possible.

The people at HMRC are good at their jobs but it seems like answering the phone isn’t one of them. Many people wait on the phone for hours and oftentimes, their calls are not answered. If possible, avoid calling the HMRC. Get an online account and utilise it to its full extent and file your taxes that way, hopefully avoiding the need to call.

  1. Claim any charitable donations against your income. Donate now to reduce your tax bill for last year.

Almost all of your charitable donations (to registered charities) are tax-deductible. Make sure to include these when you file your taxes as they will reduce the overall amount of tax you owe. You can even include any charitable donations you have made up until the time you file your taxes. If you want to reduce your tax burden for last year, find a charity that you like, donate and file it with your previous year’s taxes.

  1. Be aware of the tax’s due child benefits.

Child benefits in the UK are tied to household income. That means that if you make more than fifty thousand pounds annually, your child benefits will need to be repaid retroactively and on a sliding scale related to your income.

  1. File on time.

Why pay penalties or late fees when you don’t have to? By filing your taxes on time, you avoid the headache and the cost of being late. When is your self-assessment due? January 31. When is the last day to file to avoid a late payment fee? February 28. Mark these dates in your calendar!

  1. Know what income and assets are necessary to declare to avoid any confusion in the future.

To put it simply, all of your income and almost all of your assets are necessary to claim every year. Your forms should clearly state what needs to be declared so do not skip anything as this may come back to bite you later.

Be Prepared to Reduce the Burden of Doing your Taxes

            Taxes are an inevitability. Be prepared and follow these tips to make the process as smooth and seamless as possible. For help on doing your own taxes, get in touch with AccountingPreneur today!