Tax may not be your main priority right now. You must be thinking the Self Assessment tax deadline isn’t until January, right? In fact, there is a deadline fast approaching, you will have to make a payment to HMRC before the 31st July.
Many private hire and taxi drivers forget that income tax is paid in two half’s, bring costly consequences for those who miss the deadline. However, if you meet your requirements and payments on account, this can save you money in the long run.
The 31st January is well known for submitting your Self Assessment tax return to the taxman, which is when you pay any outstanding tax on your account, plus an upfront estimated payment for the year ahead, known as a payment on account.
If payments on account are due then the second deadline is the 31st July.
If you miss the payment on the 31st July, you will receive 3% interest penalty that will start to accrue on your account.
Payments on account are based on the you paid last year. Not your current finances – this is because HMRC can’t predict your income so they assumed that you are bringing in the same each year, even if this isn’t the case. If you pay too much tax you are able to get a rebate.
If you miss the July deadline, it will add an interest rate to the amount you’ll pay in six months’ time. Tax software like GoSimpleTax will help keep you on top of what’s happening with your revenue and expenses, which will ensure you don’t get caught out when deadline arrive.
It will also help keep your book keeping up to scratch, its based in the cloud so you can access it on any device which has internet connection, logging receipts, outgoings and any transactions as you go.
Let GoSimpleTax do the hard work for you. With FarePilot you can get a 50% discount on your tax submission - tap on the Offers button in the FarePilotapp to find out more.