- Posted 18th December 2015
Self-Assessment Tips for Contractors
When you work as a contractor, concentrating on your core work and managing your tax matters at the same time can be very difficult for you. From completing to submitting annual tax returns to HMRC, all these things needs to be done correctly and on time. If you fail to do this, you will be subjected to penalties.
To help you avoid any penalties in the future, here are some points you need to be aware of.
Submit your return on time
As 31 January is the deadline for submitting your annual tax return, you must submit it by this date. If your tax return is 3 months late, you can be charged with penalties of £100. Further penalties will be charged if your submission is late than 3 months.
Sometimes there can be complications in self-assessment tax return, so you need to leave yourself with some time before hitting the deadline.
You can either submit your returns online or in a paper return (by October 31st), but HMRC is actively encouraging the online submission of all types of tax data, both personal and corporate.
If you complete you return online, the online system will help calculate your tax liabilities, and point out if you have made any obvious errors.
Keep records of everything
You need to maintain and organise up-to-date and accurate financial records on monthly basis for your business. That’s because sometimes HMRC may ask to review your financial records to ensure all the given information is correct.
Use professional accountant
If you do not have confidence in completing your self-assessment returns, you can always seek help from contractor accountants. Not only they will complete your annual returns correctly, they can be a great help in solving your tax affairs and claiming appropriate tax reliefs as well.
In addition to that, you do not have to worry about costly surprises and can have a peace of mind to focus on your business.