You might remember the HMRC adverts proudly proclaimed “tax doesn’t have to be taxing”, but when you’re within a few weeks of the deadline for filing your online personal tax return, it isn’t the most stress-free time.

The filing deadline for online returns is 31 January, so your 2014 tax return must be with HMRC by 31 January 2015. At TLC we try to live up to our name, so here are our top tips for making sure you avoid the initial £100 penalty and file your tax return on time (or make sure we file it for you).

Know whether you need to file a return

If you are a company director, self-employed or have rental profits or untaxed income, you’ll generally need to submit one. Likewise if you have a Capital Gain over the reporting limit (so a gain of over £10,900 for last year) – you could have sold an investment property or shares.

This year for the first time, those who pay higher rate tax and claimed Child Benefit may also need to file a tax return.

Remember you should have told HMRC you needed a tax return by 5 October last and unfortunately there are penalties for late notification too.

Give us a call if you want to double-check and we will advise or you can fill out HMRC online questionnaire and check for yourself here 

Gather all of your information together

Income – any bank statements to show how much interest you earned, dividend counterfoils, details of your income (pay slips, P60s or P45s), P11Ds for any benefits in kind or your accounting records (invoices raised/other papers) and any other documents showing income received i.e. rental income statements.

Expenses – this depends on why you are completing a tax return, so your usual business expenses as a sole trader, for employees or directors perhaps professional subscriptions or mileage paid for using your own personal car (when you are paid less than HMRC’s authorised mileage rate at 45p per mile). As a landlord it would be the costs you incur linked to the property, so mortgage interest, insurance, repairs etc.

Pension Contributions – the amount you actually pay per month/per annum (before tax relief is given at 20%).

Include Gift Aid

You can claim a tax break on any charitable payments on which you make. You need to know the actual amount you donated, not the amount including Gift Aid that the charity may claim.

Don’t forget to pay what you owe

The deadline of 31 January applies to not only filing the return, but paying any tax too. Interest is charged on late payment and a 5% surcharge penalty is levied if payment is delayed beyond 28th February.

Potential penalties

The initial penalty for submission after 31 January is £100. After that, if your return is more than three months late, you’ll be fined £10 a day, up to a maximum of £900. After six months, an additional penalty of either 5 per cent of the tax due or £300 – whichever is greater – will be added. The penalties soon mount up.

The worst offenders

HMRC revealed this week that males working in the communications industry are most likely to be late submitting their tax return. So far, 6.45m tax returns have been submitted, but there’s still 4.5m yet to be filed.

Not all accountants and lawyers filed their return online, with 219 out of every 10,000 being late compared to the best group of people, those in agriculture, fishing and forestry of whom just 109 per 10,000 were late. Don’t worry, despite a rather large pile of returns to work through, we’ve done ours!

For expert advice on your situation, give Claire a call on 01937 547109.