Gather all Necessary Documentation
This section will discuss the essential documents you need to gather for a successful self-assessment.
Check for any Changes or Updates from HMRC
When preparing for your self-assessment, one of the first things to do is visit the HMRC website. This is where you will find all the latest information and updates related to tax filing. You can also sign up for email alerts from HMRC to notify you of any changes or updates.
It is essential to keep an eye out for any updates regarding tax laws, regulations, and deadlines, as they can be subject to change each year. For example 2020, due to the COVID-19 pandemic, HMRC extended the deadline for 2019/2020 self-assessments by three months until January 31st, 2021. Such changes are significant for individuals who would have otherwise been unaware of this extension.
Another critical update to look out for from HMRC relates to Making Tax Digital (MTD). This new system requires businesses and self-employed individuals to keep digital records of their earnings and file their taxes online every quarter.
Utilise Online Tools and Resources
These resources can save you time and effort and ensure that your self-assessment is accurate and compliant with the HMRC guidelines. Here are some essential online tools and resources that you can use to ace your self-assessment:
Common Mistakes to Avoid During Self-Assessment
Self-assessment can seem daunting, especially for those who need to become more familiar with the process. It involves evaluating your performance, achievements, and development over a specific period. However, it is an essential exercise as it allows you to reflect on your progress and identify areas for improvement.
While self-assessment can be beneficial if done correctly, some common mistakes can hinder the correct effectiveness of the exercise. This section will discuss these mistakes and provide tips on avoiding them to ace your self-assessment in the UK.
How to Maximise Deductible Expenses
One of the critical components of completing a self-assessment in the UK is maximizing your deductible expenses. Deductible expenses are legitimate business costs that can be deducted from your total income, reducing the amount you must pay in taxes. As a self-employed individual, it is crucial to understand how to effectively maximize these expenses to lower your tax bill and increase your take-home earnings.