Tax timebomb

A warning has been fired about tax bills in the New Year.

A warning has been fired about tax bills in the New Year.

Partner Robert Smith has highlighted the issues the pandemic may create for some individuals and businesses.

“The 31st January annual tax return deadline may be compounded by other demands,” he said.

“Some will have taken advantage of the six-month holiday on last July's income tax payment.

“That means double the bill on 31st January.

“Business owners may have also taken advantage of delaying VAT payments.

“It could all add up to a tax timebomb for some.”

It was important to manage finances.

“We are in a challenging period. Up-to-date financial and management information is important during normal times, now it is even more crucial.

“The earlier potential issues with cashflow are known, the better. We can then help with planning.

“It could be, for instance, we need to work with HMRC to set up a time-to-pay arrangement.

“It's important, if there are issues, HMRC is aware as soon as possible. Once it goes past its deadlines, negotiating becomes difficult.”

As for the 31st January tax return deadline, Robert said: “Clients can help themselves by sending information to ourselves as soon as possible.

“We always advise not leaving it until the last minute; that's even more important to stress this year.”

If you have concerns going into 2021, please get in touch with your usual RNS contact.

Robert can be called on (01724 842713) or emailed at rob.smith@rnsca.co.uk

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