Don’t let your tax bill get you down – file your return before 30 December and spread the payment over a year!

With the festive period looming, completing self-assessment tax returns are the least of most people’s worries, however, if you are employed or receiving a pension and have tax deducted at source by your employer there is a benefit to filing your return before Christmas!

If your return is filed before 30 December 2018 you can elect to have your tax collected through ‘Pay As You Earn’ (PAYE). This will mean you spread the payment over 12 months rather making one lump sum payment before the 31 January 2019 deadline.

To elect for your tax liability to be collected through PAYE the following conditions apply:

• Your total tax liability is less than £3,000
• You already have tax deducted at source either as an employee or on a pension
• Your total annual income is sufficient that you will not have more than half of your income deducted in tax each month or will not pay double your normal tax

Remember: If you elect to have your 2017/18 tax deducted through your PAYE code you must disclose this on your 2018/19 tax return to ensure the calculations are correct.

For many, the Christmas period is an expensive time. Trying to Factor in your tax bill may result in cash flow issues – get ahead, file your return before Christmas and spread the cost over 12 months!

And don’t forget – it is now only 51 days until the final filing deadline of 31 January 2019.

If you would like us discuss the above please contact us here https://www.whitingsllp.co.uk/about-us/contact-us/

Links: https://www.gov.uk/pay-self-assessment-tax-bill/through-your-tax-code

Disclaimer - All information in this post was correct at time of writing.