Rushing to meet business tax deadlines can be extremely stressful. Ideally, you would have your paperwork in order and meet the filing date with plenty of time to spare, but all too many people leave it until the eleventh hour and then rush like mad.
Or worse, they miss the deadline completely and face a late filing penalty. So how can you minimise the risk of this happening to you?
Be organised
The best way to avoid getting stressed about tax deadlines is to be organised. Make sure you know when the filing date is for your income tax returns or any other tax returns as applicable.
Since dates may change periodically, check with the appropriate government body—either via their telephone helpline or online—and keep these dates on your calendar, along with a timely reminder several weeks or days beforehand.
Keep your accounts up to date
Keeping your accounts up to date is good practice irrespective of whether you have a tax return due. Nobody is immune to the horror of an impromptu tax investigation, so it makes sense to have your paperwork in order at all times. And if you run a small business, it is financial suicide to neglect the accounting—without access to up to date figures, how can you tell whether the business is making a profit or loss?
Hire an accountant
Hiring an accountant is one way to ensure you don’t miss crucial tax deadlines. Since you are paying your accountant to deal with the necessary paperwork and prepare the figures for filing, in theory, you shouldn’t have to worry about a thing. However, they can’t do their job if you don’t give them the right information on time, so you do still need to get your house in order long before the filing date looms on the horizon.
What to do if you missed the tax deadline
If you are unfortunate enough to miss a tax filing deadline, the important thing is not to sit back on your laurels because you think a few more days won’t make any difference. Try and get the paperwork in as soon as possible to minimise the amount of interest or penalties you will end up paying.
In some cases, you may be able to avoid paying a late filing penalty if you can prove you had ‘reasonable cause’ for being late. For example, if you were seriously ill in hospital or a close member of the family passed away, the tax office may look favourably on your plea for clemency. However, if you have a history of filing your returns late, don’t expect much sympathy.
What to do if you can’t pay your tax bill
In the event you can’t afford to pay your tax bill or corporation tax bill, it is essential that you take advice from your accountant or talk to the tax office directly to discuss your payment options. You may be given more time to pay the outstanding amount or come to some kind of arrangement whereby you can spread the payments over a longer period of time. But whatever you do, never ignore an outstanding tax bill or the situation will only get worse.