When it comes to paying tax, we all know it’s got to be done, but that doesn’t mean we’re going to enjoy it! Parting with the money to pay your tax can be hard but getting a fine because you haven’t paid it on time makes it even worse. Here’s a simple guide on when to pay your tax and how to avoid those nasty fines.
Your Self-Assessment must be submitted electronically and paid by the 31st January following the tax year the tax is owed for (e.g. Tax year 17/18 must be paid by 31st January 2019). If you are completing a paper tax return this must be submitted by 31st October following the end of the tax year, but you still have until 31st January to pay any tax owed. If you have payments on accounts due, these will need to be paid by in January as well as by the 31st July. For more information on payment on account, please visit our simple explanation.
If you miss the deadline for paying your Self-Assessment you are then faced with a £100 fine. This will remain at £100 providing you then pay the tax due within 3 months of the deadline, otherwise it will rise further.
Corporation tax owed must be paid within 9 months of the end of your accounting period (e.g. Year-end 31st January – tax must be paid by 31st October) unless you are in your first year of trading.
If you are in your first year of trading you must pay your corporation tax 9 months after you have traded for exactly 12 months, based on your incorporation date (e.g. Incorporated 5th June 2017 – tax due 5th March 2020 even though accounting year-end would-be 30th June).
There are no late payment penalties for corporation tax assuming accounts and corporation tax returns have been filed on time. HMRC can and will charge you interest at their official rate of interest charge based on any outstanding balance though.
Here at MBS Accountants we pride ourselves on getting your tax liabilities worked out as soon as we can, so you have plenty of opportunity to save and plan for your tax bill. We also provide a personalised important dates document to help make sure you know what is due when.
With our systems and processes rolled out into your business deadlines are never an issue. We help you plan in advance and have information up to date throughout the year without taking up lots of time. If you would like an accountant that can support you and avoid the stress of looming tax deadlines then book a discovery call here.