Ever wondered what goes into a personal tax return and if there is more you can gain from the process?

Every year, millions of UK taxpayers have to complete and file a tax return which summarises their total income for the year.

Do you fall into the criteria of having to complete a return?

If so, you know you have to complete a tax return, which means you’re governed by three deadlines each year:-

1)     31st January – Filing date for the return

2)     31st January – Tax due from the prior year plus first 50% payment on account towards the next year

3)     31st July – Second 50% payment on account towards the next year

So you could argue the tax return is a necessary evil.  You have to complete the return and you get no benefit from it. The primary aim is to tick the compliance box and avoid a penalty. Sound about right?

At Wood & Disney, we use a comprehensive 9 step process to complete your tax return correctly. This has allowed us to look at things differently.

As with everything, there is another way to look at this. If you have to complete a return, then surely there is a way to plan for the tax you will have to pay?

In order to give you better insight into what could be coming (in terms of tax due), we need two things;

1)     Information about your income to date

2)     A projection of your income for the remainder of the tax year

Once we have these two things, we can then help you estimate your tax liabilities and plan accordingly.

Why do this?

-         Reduced stress and uncertainty about your tax bill (at the moment, you know a tax bill is coming but are unsure of the total due)

-         Gives you the ability to budget (perhaps even pay the tax monthly)

-         Pay only the tax you owe instead of paying tax early unnecessarily

-         Ensure you avoid any fines, penalties or interest

-         Let you relax and enjoy the festive period without worrying about the dreaded 31st January deadline!

Next steps

1)     Start with a review of your household expenditure to better understand precisely what you need to earn. Once you have a figure, this can then be extrapolated to give you a target income (after tax) to achieve.

2)     If you need any help with starting this process or simply have any questions, please let me know by either;

• Connecting using the blue button below
• Email me on [email protected]

Over the past 15 years I have worked with professionals on the usual accountancy compliance work you'd expect, however over the past 5 years I have been much more focused on helping HR consultants such as you grow their businesses. I have written articles and created videos on scaling your HR consultancy business. A selection of some of these are below;

1. Do you ever get the feeling you're undercharging for your work? https://www.youtube.com/watch?v=ROAG4xBzvz0

2. Is creating certainty on your to do list today? https://www.dhirubhai.net/pulse/creating-certainty-your-do-list-today-david-rudd/

3. How to educate the creepers! https://www.dhirubhai.net/pulse/how-educate-creepers-david-rudd/

4. How to control your business by using your financial information https://www.dhirubhai.net/pulse/how-control-your-business-using-financial-information-david-rudd/

5. Three steps to business success https://www.dhirubhai.net/pulse/three-steps-business-success-david-rudd/