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Navigating personal tax return for start ups
Starting a new business is an exciting journey, but it also comes with its fair share of responsibilities, including managing your personal tax return. This article will help you navigate this crucial aspect of your startup journey and answer some of the most common questions asked by start ups.
When are personal tax returns due?
In the UK, personal tax returns are due by 31 January following the end of the tax year. For example, for the tax year ending 5 April 2024, the due date is 31 January 2025.
It’s essential to meet this deadline to avoid penalties and interest on any unpaid tax.
How to do a personal tax return
Filing your personal tax return involves several steps:
- Register for Self Assessment: If you’re self-employed or have other income to declare, you need to register with HMRC. You can find additional guidance on how to register for Self Assessment here.
- Gather your documents: Collect all necessary documents, including income statements, expense receipts, and any other relevant financial records.
- Complete your tax return: You may be able to file your return online through the HMRC website. Ensure you fill in all sections accurately.
- Submit and pay: Submit your completed tax return by the 31 January deadline and pay any outstanding tax due.
This article provides more detailed guidance on filing your personal tax return, including deadlines for paying any tax due.
Are personal tax returns public record?
In the UK, personal tax returns are not public records. They are confidential documents between you and HMRC. If you work with a Tax Adviser or Accountant you may authorise them to access and submit tax returns on your behalf. As Chartered Accountants, Tech Relief is bound by the principle of confidentiality and cannot share your personal tax return information with unauthorised parties. However, there may be scenarios when you wish your tax returns to be shared with a third party e.g. if you are applying for a mortgage.
Can I claim Accountant fees on my personal tax return?
Yes, you can claim accounting fees as a business expense on your personal tax return if they are incurred wholly and exclusively for the purpose of your business and they are not capital expenses. This means that the fees must be directly related to the running of your business and not for personal advice. If you hire an Accountant to file your personal tax return they will claim the appropriate costs for you.
Accounting fees should be listed as part of your business expenses on your Self Assessment tax return. This deduction helps reduce your taxable income, thereby lowering your overall tax liability.
The timing of tax relief will depend on which accounting method you use to prepare your personal tax return and the date on which you paid the invoice.
Final thoughts
Managing your personal tax return as a startup owner can seem daunting, but with the right information and resources, it becomes much more manageable. Always keep accurate records, meet deadlines, and consider seeking professional advice to ensure compliance and optimise your tax situation.
Feel free to reach out if you have any more questions or need further assistance.
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