Filling the right amount of tax at the right time and getting a tax refund shouldn’t be taxing
XPATLINK aims to take the pain out of many people’s biggest headache.
No more worrying about missing your dates or overpaying the HMRC. Get all your tax issues sorted by a real, certified accountant.
It doesn’t matter how complicated your situation is or how much you earn. We make the process fast, efficient and a whole lot less scary than doing it yourself.
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FREQUENTLY ASKED QUESTIONS ON FILING TAX RETURNS IN THE UK
Q: DO I NEED TO FILE A TAX RETURN?
A: You need to file a tax return in the UK if:
- You’re self-employed and earned more than £1,000
- You made over £12,300 in profit from investments – usually property or stocks;
- You have rental income over £2,500
- You received more than £10,000 from dividends
- You received more than £10,000 from savings interest
- You have any other sort of untaxed income bigger than £2,500.
Q: WHAT ARE THE ADVANTAGES AND DISADVANTAGES OF HAVING A LIMITED COMPANY FOR TAX PURPOSES?
A: A lot of self-employed people choose to set up Limited Companies and the major advantage is that it limits the amount of money you stand to lose if the business suffers a loss. It also greatly reduces your personal tax bill.
On the other hand, you’re giving up some privacy, and adding a few set-up costs. You’re also going to increase your accounting and bookkeeping requirements. For example, since your company’s money isn’t strictly “yours”, you have to make separate tax returns for the company.
Q: I HAVE A LIMITED LIABILITY COMPANY; WHAT KINDS OF TAX RETURNS NEED FILING?
A: A Limited Company has to file a few different kinds of paperwork to stay in business. One of the most obvious is your Company Tax Return. This is how your Corporation Tax is worked out, and mostly has to do with the profits or losses you made.
One thing to keep in mind is that this is separate from your annual return or “confirmation statement”. An annual statement is a yearly check that all the conformation Companies House holds about your company is correct.
When you set up a limited company, you’ll have dates to submit annual accounts to Companies House and a company tax return to HMRC. The period covered by your tax return can’t be longer than 12 months so if you have been trading for longer than that, you may have to file two tax returns to cover the period of your first accounts. If you do, you’ll also have two payment deadlines. In the following years, you will usually only file one tax return.
All Directors of the company also need to file your personal Self Assessment tax return as a director of the company. Self Assessment returns work out how much tax you owe personally, and again are separate from your company’s return.
Q: WHAT IS SELF ASSESMENT AND HOW DO I FILE IT?
A: . Running a Limited Company means submitting a lot of paperwork to HMRC and Companies House. As part of this, directors have to submit annual Self Assessment tax returns. The Self Assessment tax return is essentially a model that allows the tax payer provide data needed for assessing the tax payable without HMRC first checking them in detail and agreeing to them. The HMRC will check them within a year of the final deadline for sending the return back to them (31 January).
You need to fill in your return giving full details of all taxable income and gains you received in the year, and claim any allowances as well. This means that you are responsible for ensuring that you pay the right amount of tax, even if you do not actually work out the tax yourself.
The Self Assessment system is a bit tricky and often leads to people paying too much tax and requiring a tax refund. To avoid any complication its advisable you get the help of a professional accountant like XPATLINK
Q: WHAT RECORDS DO I KEEP FOR TAX PURPOSES?
A: HMRC will expect you to tell them about any benefits you’ve received, whether that’s Jobseeker’s Allowance, Sick Pay or Statutory Maternity Pay. You should also record any income or other benefits you’ve had from things like employee share schemes. It’s all part of the big-picture overview of your finances that the taxman wants to see.
Everyone must by law keep records of their income and their capital gains for at least 22 months after the end of the tax year to which they relate, so that they can fill in a tax return fully and accurately if they get one.
People who have businesses – such as the self-employed and partners and those letting property – must keep their records for at least five years and ten months after the end of the tax year to which they relate.
You will find it easier to manage your tax affairs if you keep them up to date. If you get behind, you may have to pay interest, surcharges and penalties.
Q: I think I have paid too much tax, what can I do?
A: If you are self-employed, you can request for your statement from HMRC and if your Statement of Account shows you are due for a refund, you can either:
- Ask HMRC to rrepay it and it will be credited to your specified bank account.
- Ask HMRC to credit it to your tax return account, this would mean you can set it off against future tax payable.
If you are an employee on PAYE, your employer will normally pay it back to you on the next pay day after you get your proper code. If the tax year ends before you get your proper code, the Tax Office will send you the repayment
Q: HOW QUICKLY WILL I GET MY TAX REFUND?
It takes a few weeks to put together a really comprehensive tax refund claim. As soon as you’re happy to go forward, XPATLINK is happy to help you process your Tax Refund the HMRC won’t even speak to us about your claim. As soon as your refund’s paid out, we’ll either send you a cheque or pay it into your bank account if you prefer.
Remember that you can claim for the last 4 tax years and you can make your claim at any time.
Q: WHAT DOES TAX RETURN, TAX REFUND AND TAX REBATE?
A: A tax return is a form you use to tell HMRC about your earnings and expenses. It’s a complete overview of the taxable income you’ve made and the costs of doing business you’ve faced.
A tax refund is money HMRC gives back when you’ve paid too much tax. There are several reasons why you might overpay, and you often have to file a claim and prove you did.
A tax rebate in HMRC’s language, a tax rebate is “a refund on taxes when the tax liability is less than the taxes paid”.
Q: How Can XPATLINK help in all of this?
A: We are a leading accounting firm and tax experts . We can advise on your business’ set-up, or even act as your official agent with HMRC. What’s more, our specialist tax return service can solve all your personal and company tax return problems. We’ll save you money and keep you on the right side of HMRC. Get in touch to see how we can help.