Make Christmas less taxing

While nobody is quite sure what Christmas is going to look like this year, there is one way to guarantee that it will be less stressful and that’s by getting your Self Assessment tax return submitted well ahead of the 31 January deadline.

Tax payers can complete their Self Assessment for the previous tax year from as early 6 April but many, traditionally it seems, choose to wait until Christmas to fill it in – leaving a sense of impending doom to settle over the festive period.

If you do find you are spending part of the festive period sorting out your receipts, then you can blame Prime Minister William Pitt the Younger. He introduced Income Tax – the first tax in British history to be levied directly on people’s earnings – back in 1799 as a temporary measure to cover the cost of the Napoleonic Wars.

Today, it remains a temporary tax, which expires on April 5 each year, and has to be renewed as a provision in the annual Finance Bill. The Provisional Collection of Taxes Act 1913 permits the Government to continue to collect Income Tax for up to four months after the expiry of the measure, until the Finance Bill becomes law.

Last year, the number of people filing online increased to more than 10.4 million for the first time ever. However, more than 700,000 submitted their tax returns on deadline day, the peak hour for filing was between 4pm to 4:59pm when 56,969 filed. Thousands of customers filed their tax returns at the last minute, with 26,562 completing their returns from 11pm to 11:59pm on Friday 31 January 2020.

Here at Lewis & Co, we would always suggest that people plan ahead and give themselves the time to find our how much tax they need to pay – even if that simply takes away some of the stress around this holiday period.

The sooner you can send all your information to us, the more time we’ll have to work through any questions we might need answered before your form is completed.

In this strange and difficult year, HMRC has introduced a range of deferrals and payment plans. Self-assessment taxpayers who deferred payments from July 2020 and those due in January 2021, will now not need to be pay until January 2022. However, it is still important to submit your tax return on time.

If you’ve got any questions about getting your accounts in order ahead of the deadline, please do call us on: 01892 513515.