Don’t leave your tax return until the last minute!
Start Getting Organised Now
Over half a million people are required to send in a self-assessment tax return this year. Each year, without fail, a large proportion leave it until the last minute. This creates added pressure on the individual and also puts pressure on Revenues IT Systems from so many people trying to upload and fill in forms online resulting in the system slowing down. Several lessons can be learned from the tax return experiences of the majority this year. Take the progressive approach and start planning ahead.
7 Reasons to Get Your Tax Returns Prepared Early in 2020
1. File Early But Only Pay Tax On November 12th 2020
Preparing and filing your tax return early in the year still means that you don’t have to pay the tax liability until the normal due date in November. Why wouldn’t you file early and get prepared?
Update: 17/09/2020, Revenue announced a four-week further extension to the Pay & File deadline for those who file online. For customers who file their 2019 Self-assessed Income Tax Return and make the appropriate payment through the Revenue Online Service (ROS) in respect of Preliminary Tax for 2020 and any Income Tax balance due for 2019, the due date is now further extended from 12 November 2020 to Thursday, 10 December 2020. Read more
2. You Have Time To Save For Any Tax Due
Calculating and filing your tax return early will allow you to save for your tax bill monthly and take the pain out of scrambling last minute to get the cash together. Or worse not being in a position to pay the deadline and incurring penalties or having to agree a payment plan with Revenue under their terms.
3. Filing Early Reduced Mistakes and Gives You Time
By filing early you can plan and utilise all of the tax options open to you regarding tax based incentives which could assist your tax position. Also filing early reduces the risks of mistakes being made which have to be corrected thereafter.
4. Refunds Can Be Processed And Received Quicker
Should you find yourself in the fortunate situation where you are due a refund from Revenue, then filing early can mean that your refund is processed quickly and you will receive the money in a quicker time period. This is because refunds are often processed far slower around tax deadline as Revenue staff and systems can be overwhelmed at this time. If you file early you will get your refund quicker! Why wait?
5. Avoid Missing The Tax Deadline
Every year despite all of the advance reminders and the news reports there are always the many stragglers that leave everything to the last minute and many leave it too late! Thus they miss the deadline and incur nasty penalties as a result (up to 10% of their liability). A further daily rate can also be added to the liability by Revenue. Why pay more that you have to? It doesn’t make sense to waste money. You worked hard enough to earn it in the first place!
6. Open Up A Savings Account For Your Tax Bill
By opening a separate tax account you will be able to chip away at your liability through out the year and this will help you manage the business from a cash flow perspective, which is crucial to the stability of every business. Also the interest you make on the savings will also help a little bit when it comes time to pay. Every but helps!
7. And finally…why not start preparing now for 2021 while it is still fresh!
Take the right approach for next year and get your tax returns organised early. Get them prepared by your accountant early in the year, filed, know your liability and start setting aside a portion every month so that you are all set come next November.
Don’t go through the same stress and hassle every year by leaving it until the last minute! Meet your accountant December or January and be ahead of the curve for next year! You might well get some sound business advice for 2021 as part of the process.
If you have any questions on this topic or have a specific questions about your tax return? Contact us today at 0818 303087 or email us at info@avidpartners.ie. Alternatively you can fill in the enquiry form below.
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