Filing Your Tax Return: A Simple Guide to Getting It Right

We are all awaiting the new year 2025, and with it comes the familiar task of tax returns. It’s important to file your tax return early, rather than waiting until the last minute. The deadline for submitting tax returns remains 31st January, a date that makes many of us aware of the looming deadline.

By filing early, you can avoid the stress of last-minute submissions and the penalties that may come with delays. This awareness helps you stay organised and meet the deadline on time. You may also need a little support from your accountant to ensure the process is accurate.

Organising your business expenses and income throughout the year is key to having all the necessary information ready for filing. The more organised your records are, the more accurate the process will be. This guide explains the benefits of filing your tax return early.

The Time is Money – The Benefits of Filing Tax Return Early

It is quite usual in the business world that your financial affairs tend to change and fluctuate with time. So this is important to keep the details in order, this will allow you to give thinking space to any available opportunities that can be beneficial for your tax planning.

The earlier you plan to file your tax returns and be prepared for the required details by being organised, the more time you will have to think and get benefits from the available opportunities.

You will be ready to gather the required information organised and collected well before time. This might include a bank statement, other financial documents or completing the process.

The experts should use the apps rather than manually arranging all the data which is a lot time-consuming. Rather invest your time in better and more productive business activities to increase your business valuation.

Meet the Tax Deadlines

If you’re delaying the filing of your tax return, be prepared for the potential consequences. Missing deadlines can result in significant fines and penalties, which can harm your business finances.

Penalties are applied whether or not you owe taxes. The first penalty for late filing is £100. If the delay exceeds three months, an additional penalty of £10 per day is applied, which can accumulate up to £900.

After six months of delay, you will incur an additional penalty of £300. If the delay reaches 12 months, the fine doubles to £600, and further penalties may apply as the delay extends.

You will Soon Get a Tax Refund

In case there has been an error observed in the tax codes sent by HMRC to the employees or directors, you should expect a refund of tax where you are an employee or a director.

However, there is an exception to the rules of tax refunds for the ones working as building subcontractors which are being operated by the Construction Industry Scheme.

Here again, comes the benefit of the early finding of tax refunds. The earlier you will be in completing the process of submission, the earlier you will find yourself on the list of eligible individuals to get the tax returns in case of have the wrong tax codes by HMRC.

This takes quite a long proof to refund the taxes by HMRC, so it is recommended not to wait until the last minute of January to complete the process. Because that is the high activity time for HMRC you do not want to wait for so long to get the tax refund.

File Now and Pay Later

If you plan to make the calculations to find out your tax liabilities, this will allow you to file your tax returns as early as now. By this, we mean that you will have a lot of spare time to think about how to manage and budget for your cash flow.

You will be able to focus on future tax payments in a better way when there is no hurry to meet the deadlines. There is a tendency the risk mistakes when you are in a hurry to file your tax returns because you are about to hit the deadline.

So to keep yourself away from the late submission penalties and error fines, try to be early and complete the process now. Moreover, this is only a recommendation that is ideal and beneficial for your business, this does not make you obliged to pay way before the date even when you are not ready.

The Bottom Line

Now that you have gathered a fair amount of information about the benefits of filing your tax return early, we can bring the discussion towards wrapping up by saying that early filing of tax returns is beneficial for your business in several ways.

However, it is imperative to understand that this will not make you liable to pay early if you are not ready yet with your details and payment. We hope these few minutes of reading will help you file your tax returns on time and keep you away from fines and penalties issued by HMRC.

Disclaimer: The information about the benefits of filing your tax return is provided in this article including text and graphics. It does not intend to disregard any of the professional advice.