Table of Contents
As the January 31st deadline is fast approaching, you may feel stressed about filing your Self Assessment tax return with the HMRC. But, if you earn a variable income that isn’t taxed at the source, you’ll need to fill out this tax return. This applies to self-employed persons, freelancers, and directors of limited companies.
Instead of spending long hours trying to make sense of your tax return, here are a few tips to make it easier when you file online.
This guide covers how to file your tax return online, including:
- Why to file your tax return online
- How to prepare for your Self Assessment tax return
- How to file your tax return online
Why to file your tax return online
Though you can file your Self Assessment tax return online or by post, filing online is easier, quicker, and more secure. On top of this, you have more time to file your tax return online. If you want to send it by post, the deadline of October 31 has already passed. But you have until January 31 to submit your online Self Assessment tax return.
When you do it online, you don’t have to worry about sending the form through the post and tracking it to ensure it arrives safely. Instead, when you file online, you get an immediate confirmation from the HMRC with your tax amount.
On top of this, filing online lets you look back on tax returns you filed online in previous years so you can access records conveniently.
How to prepare for your Self Assessment tax return
As a self-employed person, you’re responsible for reporting how much you earned to determine your taxes. So, filing your Self Assessment tax return may seem daunting. But if you prepare for it year-round, filing can be easy.
Your mandatory business bookkeeping, or records of your business transactions, will help you make accurate tax reports. The HMRC expects you to keep these records for about six years, but they’re essential to determining your taxes. You can add up your revenue and subtract eligible business expenses to determine your taxable income with these records.
Opening a business current account
If you don’t have one already, opening a business current account is a great way to separate your business transactions from your personal ones. With a unique account just for your business, you won’t have to shift through transactions to the right ones to record in your books. It can speed up your record-keeping process and make it easier to stay on top of your bookkeeping. Then, when it’s time to submit your tax return, you can double-check things more quickly.
Using accounting software
Accounting software is another way to simplify your bookkeeping and make your taxes easier. With the right tool, like Countingup, you can manage your finances and save time with automated processes. Trusted by 40,000 business owners, Countingup is the business account with built-in accounting software that brings your finances together.
With the Countingup app, you can track your business expenses with automatic expenses categorisation using HMRC approved categories. This tool helps you find and log tax-deductible expenses. Then, the receipt capture tool reminds you to snap a picture as soon as you make a purchase.
On top of all this, the Countingup app generates ongoing cash flow insights so you can stay on top of your income for more accurate reporting. It also provides you with year-round tax estimates to avoid surprises and plan for these expenses.
Countingup is also compliant with Making Tax Digital (MTD), the government initiative to transition to a digital and streamlined tax process. Starting in April of 2022, all businesses will have to register for and follow MTD processes.
Hiring an accountant
The HMRC doesn’t require you to use an accountant to file your Self Assessment tax return. But if you feel overwhelmed by the prospect of filing your own tax return online, an accountant can smooth out the process, provide relief, and help you maintain accuracy.
Plus, with Countingup, You can share your bookkeeping with your accountant instantly without worrying about duplication errors, data lags or inaccuracies. Seamless, simple, and straightforward!
You can learn more about whether it’s worth hiring an accountant here.
How to file your Self Assessment tax return online
Once you prepare everything, knowing how to file your tax return online is easy with just three simple steps.
Register with the HMRC
To submit your Self Assessment tax return online for the first time, you’ll need to register for. You can find different registration links for those who are self-employed or in a business partnership.
Your account will allow you to fill out the form. But, you will have to receive your Unique Taxpayer Reference (UTR) in the post and use this to open your Government Gateway account. So, be sure to register for your account well in advance, as it can take up to 20 days to process.
Fill out the form
Once you register, log into your account and fill out the form. This step will be simple once you maintain, check, and update your business’s financial records. With your transactions, receipts, and national insurance in order, you can calculate your income and claim tax-deductible expenses.
By inputting the numbers from your organised records, you can fill out the form easily and accurately without a worry.
After you fill in the necessary information, you can submit the form. And just like that, you’re done. The HMRC will give you a confirmation that you submitted, which you can keep for your records. Then, it will quickly tell you your tax amounts. From there, you’ll be able to choose from the available payment methods.
Simplify your tax process and more with Countingup
Financial management can be stressful and time-consuming when you’re self-employed. And filing taxes can be overwhelming if you don’t know how to stay organised. That’s why thousands of business owners use the Countingup app to make their financial admin easier.
Countingup is the business current account with built-in accounting software that allows you to manage all your financial data in one place. With features like automatic expense categorisation, invoicing on the go, receipt capture tools, tax estimates, and cash flow insights, you can confidently keep on top of your business finances wherever you are.
Start your three-month free trial today.
Find out more here.