After the struggle with COVID, the years are even tougher because of the cost of living crisis. There is no doubt that the domain of the tax is no one’s favourite especially when you are going through a phase of unprecedented times. However, there are tax-saving tips for the cost of living crisis that will allow taxes to work better for you rather than being a painful experience for your income. Further in the discussion of this article, we will focus on the most prominent tax-saving tips to handle the cost of living crises in the UK. This involves the requirement to meet the deadlines of the self-assessment tax returns, ways to reduce the tax bills, claim tax-deductible expenses, and ways to avoid the overpayment of the tax bills.
Talk to one of our intelligent and clever professionals to get your further queries about tax-saving tips for the cost of living crisis. We will ensure to come up with the best possible solution.
What are the UK the Tax-Saving Tips for the Cost of Living Crisis?
There are some prominent tips suggested by professionals that will further help you to survive during the cost of living crisis in the UK. They are listed and explained below:
1- Deadlines for Self-Assessment Tax Returns
While you are struggling with the cost of living crisis, no one will want another add up to the problems in form of the fines charged by HMRC. When it is a matter that can be sorted out and the fines can be easily avoided. When you are a self-employed individual in the UK, 31st January happens to be the focus of your memory. This is because there is a deadline to file the tax return online or in paper form. You normally have time till the end of the month of October.
Moreover, you can even seek professional help if you are a beginner and unsure of how to go through the process. As a beginner to being a self-employed individual, you should be associated with a professional and learn about important deadlines and dates for tax submissions.
2- Take Help from Company Perks to Reduce Your Taxable Income
It is possible for individuals who are employees of limited companies in the UK, to take the advantage of the parks offered by the company. Sometimes people are totally unaware of the perks they have while they are working for a specific company. To be aware of the job perks, you can enquire the employer if they offer tax-free season ticket loans or bonus sacrifices etc.
3- Tax Deductible Expenses – Claim If You are Self-Employed
You must be well aware of the tax deductions if you are working in the role of a self-employed individual. You must immediately gather information if you are not already familiar with the tax deductions. This is because the claim of tax deductions will allow you to reduce your tax bill. It is wide to check what can come under the tax-deductible expenses because not everything in the business expenses can come under this category. This will make you involved in tax fraud unknowingly.
4- Use the Benefit of the Marriage Allowance
The marriage allowance is obviously not granted to all people but the ones who are married. When you have a marital status, it is worth checking the availability of the marriage allowance. In this case, the basic rate of the tax of 20% is applicable to you and if the earnings of your partner are less than the amount of £12,570, your partner will be allowed to transfer a part of the personal allowance to you because they are not paying income tax.
- An amount of £1,260 from the personal allowance can be transferred to you from your partner.
- For this, you will have to be in a civil partnership or a married couple.
- If a higher or additional tax rate is applicable to you, you can not avail of this opportunity.
- You and your partner were born after the period of 1935.
5- Avoid Overpayment of the Tax
Nothing can sound better than receiving the brown envelope that will unfold the news of the tax refund to you. Because the overpayment of tax is a common mistake in the UK. This can happen because of a job change, being jobless for a period of time, switching from being an employee to the self-employed one or any other such reason. When it comes to the mistakes of HMRC, there is no quick way to fix them. The tax rebate will not be automatic also.
The Bottom Line
Now that you have gathered a fair amount of information about tax-saving tips for the cost of living crisis, we can bring the discussion towards wrapping up. The cost of living crisis in the UK is tough but so are you. Learning the smart ways to reduce tax bills will further help you for a better living. We hope these few minutes of reading will help you to develop a better understanding and you will be able to handle the cost of living crises in a better way.
If you seek professional help, learn more about tax-saving tips for the cost of living crisis. Why wander somewhere else when you have our young and clever team of professionals at Accotax?
Disclaimer: The information provided in this blog about tax-saving tips for the cost of living crisis, including the text and graphics, in general. It does not intend to disregard any of the professional advice.