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HMRC are talking about the end of the tax return.
That’s the self assessment tax return, rather than the corporation tax return that limited companies need to do every year.
The self assessment is the tax return that’s due on 31 January and every sole trader and limited company director needs to do.
It’s the tax return I’m talking about in my group programme Tax Return Success and when I say I help you do your own tax return or help you understand what your accountant is doing when they do it for you (if that’s you, it’s no charge to book a chat to explore how I can help).
So is it the end?
A lot of people are asked to do a self assessment tax return by HMRC even though they have simple finances and it will be the end of the tax return for them. (About time you might say).
We’re moving from a tax system based on One Man One Life One Job to a tax system that is more up to date and fit for purpose.
If you’re reading this, you’re not likely to fit into these categories, or in my opinion, any of the categories HMRC haven’t announced yet.
Although having said that, if you’re a limited company director and your only pay is from your company and/or other employment, it’s possible that could be taken out of a requirement to complete a self assessment. We’ll see.
They’ve already changed the way tax is charged on dividends and that was such a major change, I would hope that’s enough for now, especially with everything else going on.
So if you’re a sole trader rather hoping your tax return is going to be a thing of the past, sorry.
The tax return is important for sole traders.
For the people who are going to be taken out of the self assessment requirement, it’s only purpose was to declare income (that’s HMRC speak for telling them your sources of income), usually only because that was the only way they could charge you the right amount of tax.
It’s different for sole traders (Am I A Sole Trader Or A Limited Company?).
Sole traders need to tell HMRC their income, their tax-deductible expenses, their tax-deductible capital allowances and sometimes a bunch of other stuff (that’s where help comes in, not just for the expenses and capital allowances bit).
Limited companies need to do a corporation tax return, sole traders need to do a self assessment.
It’s only part of the legal requirements but it is the one people pay most attention to. It’s also the one with the penalty if you’re late.
It’s common to only pay attention to expenses and keep records because there is a tax return at the end of the year that must be done by law. Take that away, and a whole lot of folks wouldn’t be doing very much at all (despite the fact it’s legally required, tax return or no tax return).
It can feel pretty scary when you start your business when you feel you don’t understand what you need to do. Or don’t want to look at how much money you really made (clue: it’s not the number on your tax return). Or don’t understand how to claim all you can. Or the whole damn shebang.
If that’s you, it’s why I say I give you a safe space to sort out the money side of your business. Signing up for the free Self Care For Your Biz Finances Retreat is a good start to help you feel better and start changing your emotions towards money and numbers.
So bad news, it’s unlikely if you’re reading this that it is the end of the tax return for you personally.
On the other hand, now you know what it’s about when you read or hear about what’s happening.
And you can be the person to break the news to your granny that she won’t need to do a self assessment in a few years time, which is wonderful news.
In the meantime, if you need help doing your own tax return and sorting out the money side of your business, have a look at the Tax Return Success group programme or book a chat with me at no charge to explore how I can help.
Tax Return Success – online course and live group support calls
I’d love to hear how you feel.
If you are looking for a safe space and the support you need to sort out your tax return, book a conversation with me.
We’ll explore how you feel, what’s working, what’s not working and how I can help, so you can feel calm, confident, organised and on top of things.
To your financial self care,