Are you due a refund?
It's that time of year when people start to think about Christmas and New Year – unless you're an accountant, when the big issue is that personal tax returns are due to be submitted by 31st January. Ideally, much earlier to give the individual time to ensure that they have the necessary funds to pay their tax bill on time.
If you're running a business as a sole trader your business income will have a direct impact on your tax bill, but even if you're a director of a limited company you need to submit a personal tax return and the earlier you plan for that, the better.
Construction workers
If you're in the construction industry as a sole trader, the Construction Industry Scheme (CIS) may have an impact on your tax bill – you may be due a refund!
Even if you have a limited company, it's time to start looking forward to the end of March when to see what CIS you have to offset your corporation tax bill. This can impact on the decisions you make about expenditure over the next 6 months.
How is your business doing?
There's no getting away from the fact that the economy has affected us all. If that has resulted in your business' performance and you've made a loss over the last year, you may be due a tax refund. The earlier you know what this may be, the better you can plan for the future.
If all or part of your income comes from rental income for one or more properties you own, higher mortgage rates may have impacted the profitability of your business. Again you may be due a refund if payments on account have been based on previous year's figures, when the properties were more profitable.
Making Tax Digital
The HMRC's campaign to Make Tax Digital (MTD) has been pushed back to complete in 2026, but in more situations, putting your accounts online can be a very positive step for most small businesses, even if you're a sole trader. It enables you to keep track of expenditure, makes invoicing simple and allows you to see how the balance sheet looks – not once a year, but on a day-to-day basis.
This won't give you your personal tax obligation, but will give you up-to-date information on your business's viability.
So – if you haven't given your accountant your paperwork (even if it's digital paperwork) – do it sooner rather than later so you can plan ahead for what you owe the tax man.