40 | JANUARY 2020
Business
Read online at www.proinstaller.co.uk
COMMON SELF
ASSESSMENT
MISTAKES
AND HOW TO
AVOID THEM
Tax Preparation Specialist Provides
Guidance for Problem-Free Tax Returns
Facing penalties for failing
to submit on time and additional
interest if income is undeclared,
taxpayers facing Self Assessment
will be heading towards the 31st
facing the extra burden of en-
suring their tax return is correct.
Tax preparation specialist David
Redfern, Managing Director of
DSR Tax Claims Ltd, is at hand
to explain the common mistakes
taxpayers make when completing
a tax return and how they can be
avoided.
Often overlooked
‘ are
taxable
benefits, such
as statutory
maternity pay,
statutory sick pay
and Jobseekers
Allowance
’
Basics first, it is essential that an-
yone who needs to complete a tax
return for income received during
the 2018/19 tax year is registered
for Self Assessment with HMRC.
Redfern explains “Before you can
submit a tax return, you have to
register with HMRC and receive
your Unique Taxpayer Reference
(UTR). Additionally if you want to
file your tax return online, and the
deadline for a paper return has
now passed, you’ll need to register
for online Self Assessment and re-
ceive your activation code for your
online account. HMRC sends these
pieces of information by post and
they take around 10 working days,
longer at times, so time is of the
essence if you haven’t done this
yet. HMRC accepts that there will
be circumstances where a taxpay-
er cannot file their tax return on
time, but avoidable errors caused
by disorganisation or just not
realising this needed to be done
won’t be accepted as a reasonable
excuse”.
Taxpayers can register for Self
Assessment and set up their on-
line account through the Govern-
ment Gateway website. Once reg-
istered, incomplete or inaccurate
information is often the downfall
for many taxpayers. Taxpay-
ers must ensure that they have
recorded all forms of income
received so that their tax bill is
calculated correctly. Redfern stat-
ed “Most taxpayers when think-
ing of income will either focus on
their self-employment income or
the income they received from an
employer, forgetting other forms
of income like rental income,
capital gains, share dividends,
savings interest and foreign
income. Often overlooked are
taxable benefits, such as statuto-
ry maternity pay, statutory sick
pay and Jobseekers Allowance. If
you received any taxable bene-
fits during the 2018/19 tax year,
they also have to be included in
your income”. Where possible, all
figures in a Self Assessment tax
return should be actual not esti-
mated figures. Any estimates used
should be clearly marked as such
and amended for actual figures as
soon as available.
Another common mistake
when completing a tax return is
omitting key expenses or failing
to claim all available tax relief.
Redfern explains “Sole traders
and small business partnerships
need to make sure that they are
claiming the tax relief on all
their allowable expenses through
their tax return, whether relat-
ing to essential equipment for
the running of their business,
mileage expenses or the costs
involved in using one’s home as
an office or workshop. But not
all Self Assessment taxpayers are
self-employed - they could be a
high rate taxpayer or claiming
more than £2,500 in expenses. In
these instances, they won’t be en-
titled to claim as wide a range of
allowable expenses as someone
who is self-employed but they
shouldn’t forget key areas such as
charitable donations.”
Failing to meet the deadlines
is a common mistake, with near-
ly three quarters of a million
taxpayers facing a penalty after
the 2017/18 deadline. Redfern
states “Not only does the Self
Assessment tax return need to
be submitted by midnight on
31st January 2020, you also
need to make sure that you
have settled your tax bill by that
deadline as well as made the
first payment on account for the
current tax year, if this applies
to you. With a penalty of £100
for missing the deadline by just
a day and interest mounting
up on unpaid tax, it could be a
costly mistake”.
failing to meet
‘ the
deadlines is a
common mistake ’
Finally, Redfern advises those
submitting a tax return to keep
an eye out for small mistakes
which can have large costs. He
explains “Each year, some taxpay-
ers make silly little mistakes like
forgetting to actually submit their
tax return, even though they’ve
completed it, or getting their UTR
and National Insurance numbers
incorrect and these can all have
much bigger consequences, such
as penalties and fines for unpaid
taxes.”
www.dsrtaxclaims.co.uk