How early can I submit my tax return? 5 benefits of getting ahead
2-minute read
Filing an early tax return could be a great help to future you – and remember you don’t need to pay your bill at the same time, so you can still leave that until 31 January.
Tax returns aren't fun and it's easy to see why they fall down the to-do list.
But if you’re faced with some down time, there are real benefits to filing your tax return early in the tax year.
Can I submit my tax return early?
If you’re wondering whether you can submit your Self Assessment early, you can actually file one for the previous tax year any time after the new tax year starts.
This means you can file a tax return for 2022-23 Self Assessment after 6 April 2023.
Increasing number of 'early birds'
HMRC said almost 30,000 more people chose to file their tax return on 6 April in 2022 – the start of the new tax year – compared to 2018.
Myrtle Lloyd, HMRC’s Director General for Customer Services, said: "You don’t need to wait for the January rush to send us your tax return. More and more people are getting theirs out of the way early."
5 reasons to file a tax return early
1. Earlier refunds if you’ve overpaid tax
Payments on account are future payments towards your next tax bill, based on estimates for your previous one.
One payment on account is due on 31 January and the next one is due on 31 July.
If you complete an early tax return at the start of the tax year in April, you know how much your bill actually is.
This helps with planning for your future payments – and if you’ve overpaid tax, you should get your refund sooner.
Read more about payment on account.
2. It’s easier to plan your finances
Rising costs, high inflation, and the cost of living is hitting small businesses hard, while many are still trying to recover pandemic-related losses.
Knowing the actual cost of your tax bill this far in advance should help you set aside the money for paying it on 31 January.
Keep in mind that for the past two years HMRC has waived late filing penalties in February, giving people more time to file their tax return. This was to help ease pressure on Self Assessment tax payers by not issuing a penalty, although interest was calculated from 1 Februrary.
This gave people the chance to set up a Time to Pay arrangement.
Having a completed tax return early should put you in a better negotiating position if it gets to January and you don’t think that you’ll be able to pay your bill.
Read more about HMRC Time to Pay.
3. You can minimise the risk of mistakes (and fines)
HMRC says that 630,000 people filed their tax return on deadline day on 31 January 2022, with 20,947 filing between 11pm and 11:59pm.
While leaving it late might be unavoidable for some, it does carry the risk of making more errors than necessary.
And mistakes can lead to fines. While HMRC won’t issue penalties for people who’ve taken reasonable care when filling in returns, they charge 0 to 30 per cent of the tax due if people have been careless.
4. Claim all the expenses you can
Having your records organised early not only helps you minimise the risk of mistakes. It also helps you claim all the right tax-deductible expenses.
Claiming expenses reduces your total taxable profit, meaning you pay less tax.
Allowable expenses include computer software, travel, and legal and financial costs. Doing your Self Assessment early means you can make sure you’ve included all your expenses.
Read more about allowable business expenses.
5. It gives you more time to research professional advice
You can include the costs of hiring a professional accountant or adviser as a tax-deductible expense.
If you start your tax return early and aren’t sure about the details, in the first instance you should be able to speak to someone at HMRC quicker (their phone lines are notoriously bad during Self Assessment).
But if you need more advice, it gives you more time to find the right professional to help you out.
It’s important to do your research and make sure you find someone with a great reputation, as bad advice can cost you time and money.
Their advice can help you set up a proper record-keeping system, plus their knowledge of tax and expenses could go towards reducing your overall tax liability.
Read more about hiring an accountant and bookkeeping tips.
More guides to help you filing your tax return
How early do you complete your tax return? Let us know in the comments below.
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Written by
Sam Bromley
Sam has more than 10 years of experience in writing for financial services. He specialises in illuminating complicated topics, from IR35 to ISAs, and identifying emerging trends that audiences want to know about. Sam spent five years at Simply Business, where he was Senior Copywriter.
We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer
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