Ten ways to ensure many happy returns

Saturday 12 January 2002 01:00 GMT
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1. Get the right forms

Make sure you have the basic tax return form and the right additional pages, for example rental income pages if you let out property. Run off copies of missing pages from the Inland Revenue website at: www.inlandrevenue.gov.uk/sa/text/newstyle/net_00-01.htm, or call the helpline. You can also fill in your return online at the Inland Revenue website.

2. Gather all the necessary information

You need to accumulate all the relevant data, forms P60 and P11D from your employer; records of freelance income; income and expenses from letting; dividend vouchers and interest statements.

3. Allow proper time

Filling in your tax return will take time so don't leave it until the end of the month.

4. Treat it as an examination paper

This means reading the questions and answering the ones you are set. But you are allowed help, not least the Revenue's guidance notes.

5. Make sure the figures add up

When you are entering interest or dividends, cash received plus tax credit has to equal the gross amount, with the figures in the right boxes. If you get state benefits, take care, because some are not taxable (eg child benefit) but many are (eg the basic state retirement pension). You can also ask your benefits office.

Pension contributions: If you are paying into an employer's scheme, the contributions don't need to be entered. But free-standing extra voluntary contributions or personal pension payments must be logged.

6. If you haven't got all the figures

You are supposed to fill in exact and complete figures in the return. You cannot put "See accounts" or "As per P60", for instance. If you don't have all the necessary information, the Revenue will accept the return if you put your "best estimate" on the form and explain what you are doing in the white space for explanation.

7. If you are stuck

Get help. Try the Revenue helplines or one of its local offices. If you have a problem, go to a properly qualified tax adviser such as a member of the Chartered Institute of Taxation or Association of Taxation Technicians.

8. Read it over

When you think you've finished, check the form. Compare it to the details you sent in last year (keep a copy of every return) to make sure you have not missed anything obvious. Explain significant changes, such as stopping freelance work because your employment has gone full-time. Sign the form and send it.

9. Don't forget to pay

Remember, you are also expected to pay tax you owe by 31 January. The Revenue's guide is daunting. A slow procession through it will get to the answer, but also try a simple side calculation to make sure the result makes sense. That rough figure would do as a holding amount to pay if you find the form too difficult. Don't delay paying beyond 31 January or you could be liable to interest charges.

10. Don't be an ostrich

There's no point in sticking your head in the sand, because the return won't go away. Feeling you are being unfairly singled out is no excuse. The Revenue may not fine you the £100 penalty if your return gets to them a day late, on 1 February. Better not to cut it that fine.

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