Making tax digital | Royal Bank of Scotland

Making tax digital
 

The vast majority (around 90%) of people that fill out a self-assessment tax return do so online. Doing it over the internet is generally far simpler than dealing with reams of paper, but it’s still a task that can be complex.

The Government has a dedicated tax return page which helps you learn more about deadlines, potential penalties and how to get more help. If you own a limited company, it may be possible for you to file your accounts with Companies House at the same time as you are filling out your tax return. 

It may be worth working with an accountant to ensure everything to do with your tax return is completed on time. This can be particularly useful if you’ve never completed one before, or if you have a set of particularly complicated circumstances.

Going digital

We are moving to a more digital tax system which should come as welcome news to many taxpayers who already choose to report much of their information to HMRC online. The Government initiative sets out a vision that by 2020 there will be a transformed tax system and the end of the tax return. 

As part of this initiative, the smallest businesses will be exempt from going digital - the turnover threshold is to be decided. Taxpayers will send in summaries of their income and expenditure at least four times a year, creating a HMRC digital account.

Timescales for the initiative

  • April 2017 - Pilot of roll out starts
  • July-December 2017 - Digital tax accounts show taxpayers an overview of their liabilities in one place
  • July-December 2018 - Most businesses, self-employed people and landlords start updating HMRC quarterly for income tax and national insurance obligations through accounting software
  • 2019 - Most businesses, self-employed people and landlords start updating HMRC quarterly for VAT obligations through their accounting software
  • 2020 - The full range of HMRC services is available through digital tax accounts

Why go online?

One of the great advantages of submitting a self-assessment tax return online is that your tax is automatically calculated. This means that, should you be owed money by HMRC, it shouldn’t take long for that payment to come through.

You will receive digital confirmation that your tax return has been completed. Jot the reference number down or screengrab the page to ensure you retain the information.

The key thing to remember when submitting a tax return is that you cannot afford to miss deadlines. Even if you are still waiting for certain documents to be sent to you from clients or customers, make sure that everything is submitted on time. It is far better to estimate a figure than wait and end up leaving things too late.

If you do miss a deadline, you should write to HMRC as soon as possible and explain your situation. However, there is no guarantee that any appeal will be successful. 

Deadlines

Tax returns are important, and you need to ensure all necessary forms are filled in on time and accurately. When you file your company tax return, you are working out profit or loss for Corporation Tax, as well as your Corporation Tax bill.

The deadline for completing your tax return is 12 months after the end of the accounting period it covers. You will have to pay a penalty (which can be significant) if you miss the deadline. For your Corporation Tax bill, the deadline is usually nine months and one day after the accounting period ends.

Carefully check the deadlines that apply to you, and make sure you note them down.

More help with tax

FreeAgent is accounting software that can help with tax bills and more.

Get started

Visit the Gov.uk website for more help with tax returns including details of deadlines.

Visit Gov.uk
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