Tax returns for business owners

  • by Carole Jordan
  • 03 Oct, 2016
Business owner getting prepared for 2016 tax return

Tax returns are best done at a run otherwise they can spread out and seem like they are going on for ever. Nobody likes that! Follow our top tips to avoid the stress.

Get your tax return done - Eazy peazy!

The key is to gather ALL the information you need so you can hand it over to your accountant and let them do the hard work. Follow our steps below; 

1.      Dig out your tax return from last year to see what areas you need to cover.

2.       Download our tax return checklist and tick off the items as you collect them. 

Company owners and directors’ main income is likely to be dividends and salary. Find your P60, your P11D (if you had taxable benefits) and your Dividend Declarations or ask your Accountant to dig them out of their files. 

Sole Traders and Partners will have profit from their business. The accounts should be done by now and if not this is the first thing to get sorted. Prepare your paperwork and your bookkeeping records and let your Accountant have them immediately. 

Savings interest – you need a ‘Tax Certificate’ which may be available online or contact your bank or building society to send you one for the tax year 2015/16. Make sure you get the correct tax year! And, don’t forget those small accounts which you opened years ago and left with just a few pounds in them. If you leave these off the return the tax office will know and you may incur penalties and interest for not declaring everything. 

Remember too, if you had any savings bonds mature in the year as there will be tax due on that interest. 

Dividend certificates – if you have shares other than your own business you will have received tax certificates when the dividends were paid. Even if you have shares in place of cash you need to declare these. 

Property Income – You should have agent’s statements or a bank account showing the rental income you have received. Let your accountant have these along with all the costs you have paid out on the property in the tax year (5.4.15-6.4.16). Costs may include repairs & maintenance, gas checks, management costs and utilities and council tax for periods where there are no tenants. Remember mortgage interest too. You’ll need a mortgage statement so your accountant can identify the interest accurately. 

If you have a Holiday Let your accounts will be more extensive with costs for utilities including telephone and internet, TV licensing and laundry and other services. 

The best way to present property income to your Accountant is to summarise each transaction on a spreadsheet with the date, description and amount and attach the receipts and invoices to the sheet. 

Pensioners will have P60 forms from each pension company that is paying AND that letter from the government with your State Pension amount on it. That comes at the beginning of the tax year and is the most likely piece of paper to go missing when we are preparing tax returns. 

Capital Gains – if you’ve sold an investment during the year pull out the details of the cost price, any purchase fees or expenses such as agent’s fees & legal costs. Any enhancements such as extensions or improvements to a property and the proceeds and costs associated with the sale. If it is a property your accountant will need to know if it was ever your main residence and how long it was let out for. 

Student Loan Repayments – the Tax Return is the vehicle for repaying your loan if you are self-employed so let your accountant have the paperwork so you can keep up to date. 

Child Benefit Charge – tax payers with income in excess of £50,000 suffer a charge on their tax return which claws back Child Benefit paid. If your personal circumstances are more complex that caring for a child within a couple then speak to your accountant about the details of the rules, otherwise they will need to know the amount you are receiving. 

These are the most common headings for business owners’ tax returns. If you have other items speak to your accountant about what they need if you are unsure. 

It’s time to get moving now to avoid what might be a nasty shock later. And, if you can get your Tax return submitted by the end of October it will ensure you receive a statement in December confirming the amount you have to pay and giving you a reference to use to make sure your payment is credited to your account! 

Contact us now if you’d like help completing your tax return or have other tax, accounting or business questions. You can call us on: 01273 882200 or email us at: info@businessheads.co.uk

All details above were correct at the time of publishing - for more up to date information please get in touch .

You might also be interested in...

If you enjoyed the blog, why not leave us a comment, or share it with a friend...

Free advice delivered to your inbox

Browse our other blog posts...

Our latest blog

by Carole Jordan 12 Oct, 2017

This is the first in our series of blogs designed to help you better understand your business accounts. We’re kicking things off with the profit & loss report!

by Carole Jordan 09 Oct, 2017

Taking on your first employee can be an exciting time but there are some responsibilities you need to be aware of. One of them is compulsory pensions these are your auto-enrolment responsibilities. Find out what this means below.

by Carole Jordan 02 Oct, 2017

This is the second most popular question from business owners. This sounds like a simple question but the answer is complex and involves many aspects to consider. The answers will depend on the make of the car, the tax position of the owner, their business and the method of ownership.

by Carole Jordan 25 Sep, 2017

Dealing with overseas customers and VAT rules can be a bit complicated for some businesses, particularly those in retail where you may not have proof that goods are leaving the UK.
Read below to find out more about the options available to your business.

by Carole Jordan 18 Sep, 2017

If you receive rental income from a furnished residential letting then you’ll be aware of a “Wear and Tear” allowance, eligible for use against your properties. This allowance recently saw a change to its terms, read below for more details.

More posts
Share by: