A lot of people leave filing their tax returns until January, but
there are so many reasons to get it done earlier.
Speedier refunds
Filing early will result in earlier refunds of tax. Money is
better in your bank account than HMRC’s!
Cash flow
If your tax liability is under £3,000 and you submit your tax
return before 30th December 2014, it may be possible to have your tax
liability collected through your tax code.
Time
Having plenty of time to prepare your return reduces the risk of
errors being made because you aren’t rushing to get the return
finished before the final deadline.
Tax planning
If your affairs have changed this year, for example you have losses
arising or a significant amount of additional income, preparing your
return early can allow tax planning opportunities which could lead to
potential tax savings.
Time to pay
If you need to arrange time to pay your liability, the earlier you
know exactly what this liability will be, the more time you will have
to plan for this payment.
“by preparing your tax return early, we may be able to reduce or even
cancel your July instalment”
PAYE tax codes
HMRC updates tax codes to reflect the information shown on your
return. If there is an issue during the year, we may be able to
resolve this sooner rather than later.
HMRC enquiries
As HMRC’s enquiry window runs a year from the date of
submission (except in cases of fraud or neglect) personal tax affairs
can be finalised sooner.
Costly reminders
Issuing reminders may increase your costs. Help to keep your
bill to a minimum by providing information in a timely fashion.
July payment on account
If you pay payments on account, by preparing your tax return early,
we may be able to reduce or even cancel your July instalment.
Tax credits
If you are in receipts of tax credit or benefits, your claim needs
to be renewed annually by 31 July. This involves letting the Tax
Credit Office know your income. The sooner your tax return is prepared
the sooner accurate estimates can be provided to ensure the correct
tax credits are received.
