Five tips to help you prepare for the end of the tax year

The 2023/24 tax year draws to a close on 5 April, and on 6 April the new 2024/25 tax year begins.

And while the pubs and clubs are unlikely to be charging big money for a ticket to a glittery New (Tax) Year’s Eve bash - it’s still a date that should be highlighted in your business diary. 

It’s an opportunity to organise your business’s finances, finish your filing for the year and prepare for the year ahead. So to help with this, here are my five tips to help you bid farewell to 2023/24 and greet 2024/25 confidently with open arms. 

1. Get your calendar in order

A new tax year means a refreshed set of tax dates for your diary. And while we might not count down the days to these like we might a birthday or Bank Holiday, forgetting when they are or not preparing for them accordingly can’t be rectified by just sending a belated greeting card.

Here are the dates you need to know:

6 April, 2024 - the first day of the 2024/25 tax year - Any new tax rates and rules kick in (although the new National Living Wage and National Minimum Wage rates come into effect slightly earlier on 1 April, 2024) and, if you’re really organised, you can file your 2023/24 tax return from this date.

31 July, 2024 - second payment on account due - if you’re self-employed and pay your tax through payment on account, then the second payment will need to be made by this date.

5 October, 2024 - registration for self-assessment deadline - if this is your first year of being self-employed, then you must register as such by this date with HMRC. You will then be given your Unique Taxpayer Reference number (UTR) which you’ll need when you file your first (and any subsequent) tax return.

31 October, 2024 -  deadline for paper tax returns - if you plan to submit a paper tax return, you need to do it by this date. If you miss the deadline, you’ll have to submit an online return instead.

31 January, 2025 - deadline for online tax returns - you must submit your online tax return for 2023/24 by this date. Remember, you don’t have to wait for the deadline. You can submit your tax return anytime from 6 April, 2024. Filing or paying your bill late though will likely mean you have to pay a fine. 

2. Review your finances

This one might seem obvious, and it certainly isn’t something you should do once a year, but taking the time at the end of the tax year to review your business’s finances and ensure they’re accurate can help you enter the new tax year with your best foot forward. 

If you have outstanding invoices or expenses then it’s important they’re recorded, filed, paid and settled in the right tax year. And if you’ve been spending too much, or not managing your cash flow effectively, then it would be unwise to carry those habits into a new tax year. 

3. Make the most of your allowances 

There are a whole range of tax reliefs and allowances available if you’re self-employed, run a business or employ people. Making sure that you maximise what’s available can help you save money. 

Collating a list of tax-deductible expenses with receipts is a good place to start and is available for almost any type of business. Depending on your type of business - for example if you’re involved in innovation, science or technology - you might be able to claim Research and Development tax relief. If you’ve given money to charity, you might be able to claim tax relief on any qualifying donations. Some properties are eligible for discounts from the local council on business rates. You might be eligible for Corporation Tax relief too, as you can deduct the costs of running your business from your profits. And if you’re VAT registered, you can reclaim VAT on items you buy for use in your business. 

For more information on what’s available, and to check what you might be eligible for in your personal circumstances, then you can check out HMRC’s guidance here or speak to a tax adviser or accountant. 

4. Payroll and benefits 

If you have employees, then checking that payroll records are up-to-date and accurate is important. You don’t want to carry over any errors or incorrect information into the new tax year. 

But there are also some benefits and allowances that could be implemented too, and introducing them before the end of the financial year can be tax-efficient for both you and your employees. You might consider implementing the Cycle to Work Scheme, allowing your employees to purchase a bike through salary sacrifice. You could offer childcare vouchers or introduce health and wellbeing initiatives such as gym memberships or private healthcare. Certain training expenses may be tax-deductible too, meaning you can offer your employees professional development in the year ahead in a tax-efficient way. 

5. Pension contributions

Reviewing both your personal and, if applicable, your employee pension contributions at the end of the financial year can have tax advantages. For example you might be able to deduct pension contributions from your business’s profits before calculating your corporation tax liability for the year. It can also help you and your employees save on National Insurance (NI) contributions too, as employers don’t have to pay NI for their employees on pension contributions.

And this all helps with general retirement planning too! 

When it comes to tax relief, allowances and tax-efficient initiatives it’s important you fully understand what you can and can’t do. So be sure to seek advice from an accountant, a tax adviser or HMRC for specific advice on your personal circumstances.