36 percent 

We submitted 36% of our self assessment returns in January! 

Last year I submitted only one in January so what changed? 

Well, I acquired Longhill Accounts in June and we spend three months meeting, greeting, and onboarding nearly 200 new clients May – July. For the most part this went through smoothly although some had problems signing up to Accountancy Manager as they weren’t used to technology. Poor rural internet service means that many clients still do things manually as it’s more reliable. 

Once they were on board we then had to set each new client up on Xero or Xero Ledger in order to use XeroTax. And, of course, each client takes longer in the first year as we had to familiarise ourselves with them and their business. Because no two businesses are identical. 

But we don’t just do self assessment returns, we also has to keep up with limited companies’ accounts and corporation tax, bookkeeping, VAT, and management accounts. So when we had caught up everything that clients had sent in proactively we STARTED to send the annual reminders. Usually we would send reminders in April, June, and September with final reminders going out in October. This year we didn’t send the FIRST reminders until the end of November.  

Then Accountancy Manager rebranded as Bright Manager AND CHANGED ALL THE LINKS! So our poor new clients now had to handle a second set of instructions from us (once we realised that this was the problem!). 

In spite of all that the team worked their socks off over weekends and evenings in December and January and we finally submitted the last return with 3 days to spare.  

But this fabulous team shouldn’t have to work so hard and neglect their personal lives.  

We’re busy celebrating now but today we had our quarterly planning meeting to make sure that we have a much better tax return season this year. I intend to go skiing in January 2025 so we need everything submitted before Christmas. Watch this space … 

Tax Tip

Get your tax return done early so that you have more time to save the tax due. The deadline for payment is still 31 January 2025. If your income has reduced this year then we may also be able to reduce your July payments on account.

Tax Tip

Seven reasons to get your tax return done early. (It always amazes me why people leave this until the last 2-3 months)

  1. Know how much tax to pay with plenty of time to save up if necessary
  2. Have your latest accounts ready if you need finance or a mortgage
  3. Latest information available for tax and business planning
  4. Time to implement tax saving measures
  5. Less time to lose paperwork and easier to answer your accountant’s queries better
  6. Your accountant will provide a better service when they have enough time to carry out the work without the pressure of an impending deadline
  7. Your accountant will be happy and may even consider you an A grade client (yes, we do grade our clients)

Making Tax Digital – ITSA

As we adapt to a post-Brexit world with Covid, accountants are also trying to look forward to the next phase of MTD (Making Tax Digital) for Income Tax and Self Assessment.

This will affect the self employed and those with rental income (not profit) of more than £10,000 per year. I won’t go into the detail as that is available elsewhere, but I wanted to point out the timescales and why we’re already taking action with our own clients.

It’s quite a busy timeline. Most self employed use a 31 March or 5 April year end but, if not, you will have to provide current figures before the actual year end is complete. The timeline below is for a 31 March year end with a similar VAT quarter. As you can see it will be a busy 10 months with 2022/23 SA submissions to be done at the same time as 2023/24 quarterly submissions.

Of course, we’re still awaiting a lot of detail from HMRC, but our plan is:

– 2021/22 get all clients onto software with monthly bookkeeping (theirs or ours) checked by Xavier (Dext Precision) to ensure up to date digital records
– 2022/23 dummy run of MTD with a soft close each quarter to iron out any problems
– 2023/24 go live knowing that HMRC will probably offer a soft landing

Have you started to think about the next stage of MTD yet?