Key dates for small businesses 2022/2023: Keep your accounts on track
Key dates for small businesses 2022/2023: Keep your accounts on track
Running a small business means you wear many hats—often including accounting. There are a lot of things to keep in mind when it comes to keeping your finances current and juggling your tax deadlines, starting with crucial financial dates.
Staying organised and hitting your due dates keeps your accounts on track and reduces the hassle. It also helps you maximise cash flow and avoid penalties or extra costs. Now is a great time to map out the dates your business will be held accountable to in the coming year.
Table of contents
- Tax year dates
- Self Assessment tax return deadlines
- VAT deadlines
- PAYE deadlines if you run payroll for your employees’ salaries
- P11D deadlines if you provide your employees with benefits
- Capital Gains tax due dates for sole traders and partnerships
- Corporation tax for limited companies
- Wrapping up
Tax year dates
Firstly, it’s essential to know that the UK’s tax year is different from the regular calendar year. Also referred to as “the financial year”, the dates apply to employed and self-employed tax matters.
Many of the dates in this guide are determined by the start and end of the tax year, not the calendar year. So though we’re well into 2022, we’re still approaching the new tax year that will affect your accounting timelines.
What is the tax year?
The tax year for the UK typically runs from 6th April to 5th April of the next year. So the start and end dates for the 2020 to 2021 tax year would be 6th April 2020 to 5th April 2021. And any dates referred to as “during the tax year” fall between those two.
For example, critical dates for January of that tax year refer to January 2021, and deadlines falling in “the October following the tax year” refer to October 2021.
It’s important to understand how the tax year works to ensure you collect any money you’re owed and avoid penalty charges for missed deadlines. It may seem confusing, but as long as you’re clear on when your year starts and ends, you’ll be able to calculate critical dates without any problems.
For 2022, here’s what you need to know.
- 2021/22 tax year: 6th April 2021 – 5th April 2022
- 2022/23 tax year: 6th April 2022 – 5th April 2023
Top Tip: In your first year of business, depending on your incorporation date and other factors, your tax year begin and end dates might be different from the standard 6th April to 5th April. Learn the nuances of the tax year and how it affects your tax return in our simple guide to small business tax ⚖️
Potential changes to the tax year end
It is worth noting that talks are happening around the Government changing the UK tax year end date. An extensive study by the Office of Tax Simplification (OTS) weighed the costs and benefits of changing the dates to align with the calendar year (31st December) or a calendar month end (31st March).
Such a move would align with the increase in automation and digital transactions within accounting systems and tax processes and filing. But any change would also require significant time and resources to affect.
There are no immediate plans for change. But OTS recommends that the government and HM Revenue & Customs (HMRC) collaborate to enable self-employed taxpayers and individual landlords to report income using 31st March instead of 5th April. This change would make it easier to comply with Making Tax Digital for Income Tax.
Self Assessment tax return deadlines
Self Assessment tax applies to those whose income isn’t automatically taxed by their employers through the PAYE (“pay as you earn”) scheme. You’re responsible for paying taxes and National Insurance Contributions (NICs) on any income you receive outside of the PAYE tax code.
That means if you’re self-employed, a sole trader, a partner or the director of a company, you likely need to register for, file and pay Self Assessment taxes.
Top Tip: Find out more about who needs to complete Self Assessment returns in our complete guide to Self Assessment taxes ⚡️
Self Assessment tax registration deadline
If you haven’t filed a Self Assessment tax return before, or didn’t file one last year, you’ll need to register with HMRC. You need to complete this by 5th October of the year following the end of the tax year for which you need to file a return. So, if you need to file a return for the 2021/22 tax year, you must register by 5th October 2022.
You can register online at GOV.UK.
- Self Assessment tax registration deadline: 5th October
Top Tip: Want help navigating your registration? Learn the ins and outs and get help in our guide to Self Assessment registration ✅
Self Assessment tax payment and filing deadlines
Once you’re registered, you must file your tax returns each year. HMRC will use your return to calculate whether you need to pay taxes and how much you owe.
Keep financial records (like receipts and bank statements) throughout the year so you can fill out your return accurately. Once you file your return and know what you owe, you can pay your outstanding tax.
You have two options for Self Assessment tax returns: You can file an online return or send in a paper return.
Here are the deadlines for filing each and making payments for the 2021/22 tax year.
- Self Assessment paper tax return deadline: 31st October 2022
- Self Assessment online tax return deadline: 31st January 2023
- Self Assessment tax payment deadline: 31st January 2023
You can learn more about Self Assessment tax returns at GOV.UK.
When penalties are imposed for late payments
Typically, if you miss the deadlines for filing or paying Self Assessment taxes, you’ll face penalties. You accrue a fine of £100 for filing your return anytime after the deadline up to three months. And, you’ll pay more if you file after that.
You’ll also receive a penalty and be charged interest on any late payments.
You can calculate your penalties for late Self Assessment tax returns and payments at GOV.UK.
HMRC has granted extensions on penalty dates for the 2020/21 tax year due to the pressures of COVID-19. If you haven’t yet filed for last year, there’s still time.
The new dates to be aware of are as follows.
- 2020/21 Self Assessment online tax return extension: 28th February 2022
- 2020/21 Self Assessment tax payment extension: 1st April 2022
Please note that while you won’t receive a penalty for late payment, you will still have to pay interest from 1st February 2022 if you pay after the Self Assessment tax deadline of 31st January 2022.
Companies that meet certain criteria are required to charge tax (known as VAT) on the goods and services they sell. For example, in the UK, if your turnover for one year exceeds £85,000, you’ll need to register, start charging your customers VAT and pay that tax on to HMRC.
You’ll file regular VAT returns to report what you owe. Returns also allow you to reclaim some of the tax you pay to your own vendors, so keeping your records and returns up to date is in your best interest.
Top Tip: for more information on who needs to register, how VAT works and alternate VAT payment schemes, read our guide on everything you need to know about VAT 💡
VAT registration deadline
If you meet the VAT threshold in a given year, you’ll need to register for VAT. Some companies may choose to sign up even if not required, and you can do so at any time.
There are two scenarios in which you must register by a certain deadline:
- Once you know you’re going to exceed the VAT threshold in the coming month, you need to register within 30 days of realising.
- If you exceeded the threshold in the past 12 months and aren’t already registered, you’ll need to do so within 30 days of the end of the month in which you passed the threshold.
VAT payment and filing deadlines
VAT returns are generally filed and paid quarterly and are typically due one calendar month and seven days after the end of an accounting period. Specific dates differ from business to business because you choose when your quarterly period starts at registration.
Your schedule will cover a 12-month period but may not align with calendar quarters. So it’s important to keep track of your individual timelines.
For example, if your accounting periods end in March, June, September and December, you’ll need to file and pay every three months by the following dates:
- 7th May
- 7th August
- 7th November
- 7th February
Once you’ve registered, you can calculate your VAT payment dates online at GOV.UK.
Note that you may face surcharge penalties if you are late paying your VAT taxes. Find out more at GOV.UK.
VAT is going digital
The UK has been moving to digitise tax filing for everyone, and VAT is soon joining the initiative. HMRC is making Making Tax Digital (MDT) mandatory for VAT in April of 2022, so be sure to sign up before the deadline.
- Deadline to sign up to Making Tax Digital for VAT: 1st April
Top Tip: Going digital increases your accounting efficiency. Learn more about who needs to pay VAT and how to streamline the filing process in our guide to Making Tax Digital for VAT 🙌
PAYE deadlines if you run payroll for your employees’ salaries
If you employ workers on your company payroll, you’re accountable for some important PAYE deadlines. Paying through the PAYE scheme means you, as an employer, are responsible for withholding income tax and NICs from employees’ pay and passing it on to HMRC.
PAYE requires that you register for payroll benefits and then meet monthly obligations to file remittances and pay HMRC. You also need to file benefits forms on your employees’ behalf every year.
Here’s what you need to know.
Annual registration deadline
You must register for payroll benefits online before the start of each tax year.
- PAYE registration deadline: 4th April
PAYE remittance deadlines
PAYE is usually reported and paid monthly. You have two options: sending remittance by post or submitting it online. Your payment deadlines depend on which you choose.
- Paper PAYE remittance: 19th of every month
- Online PAYE remittance: 22nd of every month
Learn more about PAYE reporting and remittance at GOV.UK.
Deadlines for P45 and P60 forms
In addition to keeping HMRC in the loop on payroll benefits, you must provide the information to your employees. You do so through official forms—issuing a P60 form to each employee after the end of each tax year and a P45 form to any departing employee when they leave your employment. There’s no set timeline for P45 forms, but you’re advised to keep it timely. P60 forms are due at the end of the month following the tax year end.
- P45 forms deadline: When an employee leaves your employment
- P60 forms for 2021/22 tax year deadline: 31st May
You can get more information on P45 and P60 forms, and other benefits forms, at GOV.UK.
P11D deadlines if you provide your employees with benefits
You may need to provide HMRC with P11D forms if you give employees “benefits in kind”. These include benefits outside tax and insurance payments, for example, cars, childcare or interest-free loans.
These forms are due annually, three months after the end of each tax year. You’ll need to submit one form for each employee who received these benefits. Often, employers will also issue a copy of the form to employees as well.
- P11D deadline for 2021/22 tax year: 6th July
Learn more about P11D forms and what benefits qualify at GOV.UK.
Capital Gains tax due dates for sole traders and partnerships
If you’re self-employed, a sole trader or part of a partnership, you may need to pay capital gains tax (CGT) in addition to regular income tax. You owe CGT when you sell or dispose of a business asset.
For example, if you sell a building owned by your company or give away machinery you use in your business. You pay tax on the gain in the value of the asset over when you obtained it.
You can pay capital gains tax immediately if you know what you owe. Otherwise, you must report them in your self-assessment tax return for the year in which you realised the gain.
So, for the 2021/22 tax year:
- The deadline for Capital Gains tax payment on assets sold in 2021/22 tax year is 31st January 2023
Learn more about what you must pay CGT on and how to calculate it at GOV.UK.
Corporation tax for limited companies
Limited companies must pay a corporation tax on profits they make every year. If you’re running a limited company, you must register for corporation tax when you begin trading and file a company tax return every year that works out how much to pay.
Top Tip: Keeping up with your taxes and returns requires good accounting practices. Brush up on what you need to know to maintain cash flow and avoid penalties in our guide to small business accounting 💸
The date you register will determine your company’s “accounting period”, which may or may not align with your financial year. You must pay (or report if you have nothing to pay) your taxes after the accounting period and also file a company tax return for the year.
Here are the dates you should know:
- Corporation tax registration deadline: within three months of business start
- Deadline to pay Corporation tax: usually nine months and one day after the end of your accounting period
- Deadline to file company tax return: usually 12 months after the end of your accounting period
Get more information on how corporation taxes work at GOV.UK.
Planning for important dates and deadlines now will help you make sure things run smoothly throughout 2022. And keeping good records over the year is crucial for meeting your various deadlines and filing returns and forms correctly.
The Tide mobile and web app can streamline your accounting processes to ensure accuracy and efficiency. It integrates with your accounting software to allow you to create customised invoices and collect payments with Direct Debits. Smart features like automatically categorising your transactions and uploading receipts directly to the app simplify account management.
Photo by Nataliya Vaitkevich published on Pexels