There are plenty of reasons to file your tax return early. The biggest one is certainty.

Once you know what your Self Assessment bill looks like, you can plan for it. If you have enough money put aside, great. If there is a shortfall, you have time to deal with it rather than discovering the problem a few days before the payment deadline.

Filing early can also give you more time to find missing information, review your return, deal with payments on account and reduce the stress that comes with leaving everything until January.

About this episode

Every year, many people know the Self Assessment deadline is coming but still leave the return until the last few weeks.

That may feel harmless when January is several months away.

However, waiting removes one of the most useful things we can have when dealing with tax: time.

Submitting the return earlier gives us time to understand the liability, organise the cash, check the information and deal with problems before they become urgent.

The return has to be dealt with anyway. So the real question is whether we want to deal with it calmly or under deadline pressure.

Filing early tells you what your tax bill will be

One of the strongest reasons for completing your return early is that uncertainty disappears.

Instead of wondering how much tax you might owe, you get a much clearer figure to plan around.

That matters because filing the return and paying the bill are not the same event.

HMRC allows you to submit your return before the payment deadline. Filing early does not normally mean you have to pay early.

So rather than delaying the return because you do not want to part with the money yet, use the return to find out what you actually need to prepare for.

You have more time to budget for the bill

Once you know the amount, you have a target.

If you have already been saving for tax, you can check whether the money you have reserved is enough.

If there is a gap, finding that out months before the deadline gives you far more options than discovering it in January.

You can increase the amount you save, make payments towards the bill or adjust other cash commitments.

Our guide to How to Budget for Your Tax Bill When You’re Self-Employed explains how to estimate the liability, ring-fence money and build tax into your normal financial routine.

More time to deal with a payment problem

Finding out early that you may struggle to pay is much better than finding out at the deadline.

If you cannot pay your tax bill in full, HMRC may be able to agree a payment arrangement depending on your circumstances.

The important thing is not to ignore the problem.

Knowing the amount early gives you time to understand the shortfall and decide what to do next.

HMRC also offers a Budget Payment Plan for eligible taxpayers who are up to date with their previous Self Assessment payments and want to make regular weekly or monthly payments towards the next bill.

Find missing information before it becomes urgent

Another obstacle to completing a tax return is simply gathering everything you need.

You may need information about self-employment, employment, property income, savings, investments or other taxable income.

There may also be expenses, allowances or reliefs that need supporting information.

If you begin early, discovering a missing statement or receipt is inconvenient rather than disastrous.

You have time to retrieve information, check figures and ask questions.

If you leave the process until the final days, every missing item becomes a deadline problem.

Give yourself time to review the return

Completing a tax return does not mean we have to press submit immediately.

Preparing it early gives us the opportunity to look at the numbers properly.

Check whether the income looks reasonable. Review the expenses and claims. Ask whether anything appears to be missing.

If an accountant prepares the return for you, earlier information also gives them more time to raise questions and resolve anything unusual.

That extra review time can help prevent avoidable mistakes.

Understand payments on account sooner

Payments on account are another reason Self Assessment bills can surprise people.

Where they apply, HMRC normally asks for two advance payments towards the following year’s bill.

These are usually due on 31 January and 31 July.

That means the amount due in January can include both a balancing amount for the tax year just completed and the first payment towards the next one.

Completing the return earlier lets you see how these amounts affect your cash planning.

If your expected tax bill for the following year will be lower, there are circumstances where you can ask HMRC to reduce your payments on account. Be careful not to reduce them too far because HMRC can charge interest if the eventual liability is higher than the reduced amount.

For the full explanation, see Payments on Account Explained: What They Are, When to Pay and How to Reduce Them.

Earlier information can help with mortgages and other applications

Your tax return is not only useful for HMRC.

If you are self-employed, lenders may ask for evidence of your income when you apply for a mortgage or other finance.

Once you have submitted your Self Assessment return, you can obtain your tax calculation, often referred to as an SA302, and a tax year overview.

Getting the return completed earlier can therefore help if you know you will need up-to-date evidence of income.

A tax refund can arrive sooner

Early filing does not always mean you owe money.

Sometimes you may have paid too much tax and be due a refund.

Submitting earlier means HMRC can process that refund sooner rather than waiting until the busy January filing period.

That is another reason not to assume there is an advantage in delaying the return.

Help your accountant avoid the January bottleneck

If you use an accountant, sending your information early makes their job easier too.

January creates a natural bottleneck because large numbers of Self Assessment returns reach their deadline at the same time.

Late paperwork can mean less time for questions, less time for review and more pressure for everybody involved.

Depending on your accountant’s terms, leaving information very late may also affect the fee you pay.

An earlier start gives both you and your accountant more room to do the job properly.

Reduce the stress of Self Assessment

There is also a simple psychological benefit.

Knowing what the bill is removes uncertainty.

Submitting the return removes a task that has probably been sitting somewhere in the back of your mind.

Think of the messy room, overflowing drawer or piece of work you keep avoiding. The job itself may not be enjoyable, but there is a noticeable sense of relief once it is finished.

Tax returns can work in exactly the same way.

Getting the task out of the way gives you one less thing to worry about.

What do you need before you start?

Exactly what you need depends on your circumstances.

Typical information may include:

self-employment income and expenses
employment income
property income and related expenses
savings and investment income
pension information
other taxable income
information relating to relevant allowances and reliefs

Good records make the process much easier.

If you want a broader explanation of the return itself, see Self Assessment Tax Returns.

A simple early-filing routine

Start gathering information once the tax year has finished.
Bring your bookkeeping up to date.
Prepare the return or send the information to your accountant.
Review the calculation and understand what you owe.
Check whether payments on account apply.
Compare the bill with the money you have saved.
Deal with any shortfall before the deadline approaches.
Submit the return and keep the relevant records.

The objective is not to pay tax months before you need to.

The objective is to replace uncertainty with information and give yourself time to act.

FAQs

Why should I file my tax return early?

Filing early lets you know what you owe sooner, gives you more time to budget, helps you correct mistakes and can reduce the stress of dealing with Self Assessment close to the deadline.

Does filing my tax return early mean I have to pay early?

No. Filing the return early does not normally bring the Self Assessment payment deadline forward. You can know the bill in advance while keeping the normal payment deadline.

Can I get a tax refund sooner if I submit early?

Potentially, yes. If HMRC owes you a refund, submitting the return earlier allows the repayment process to begin sooner.

Can early filing help with a mortgage application?

Yes. Self-employed applicants may need evidence of income such as an SA302 tax calculation and tax year overview. These become available after the relevant return has been submitted and processed.

What happens if I realise I cannot afford the tax bill?

Knowing early gives you more time to prepare. You may be able to save more before the deadline, make payments towards the bill or speak to HMRC about available payment arrangements if you cannot pay on time.

When are payments on account due?

Where payments on account apply, the standard dates are 31 January and 31 July.

Episode Timecodes

00:00 – Why getting your tax return in early matters
00:54 – Starting with the Self Assessment deadline
01:49 – Why waiting until January is a poor approach
02:09 – Filing early does not mean paying early
02:30 – Knowing the liability and budgeting for it
02:49 – What to do if the money is not there
03:54 – Finding missing paperwork and reviewing claims
04:13 – Payments on account
05:20 – Giving your accountant more time
06:01 – Tax returns and mortgage applications
06:31 – Reducing stress and clearing the task
07:14 – Information you may need for the return
07:54 – Estimating your tax bill
09:37 – Final reasons for filing early

Related episodes and guides

Key takeaway

Getting your tax return done early is really about buying yourself time.

You know the liability sooner. You can compare it with the money you have saved, deal with missing information and understand any payments on account before the deadline becomes urgent.

You may also receive a refund sooner, have useful income evidence available and remove a job that has been sitting in the back of your mind.

Most importantly, filing early does not mean paying early.

Do the return, understand the number and use the time between filing and payment to plan properly.

Plan it, Do it, Profit.

Further Support

If you want an estimate of your tax or need help understanding your wider business numbers, use our free online business calculators.

If you need help preparing your Self Assessment, understanding your tax bill or planning how to pay it, you can contact us for an initial chat.

You can also watch more practical finance and tax support on the I Hate Numbers YouTube channel, or listen and follow on Apple Podcasts.

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File Your Tax Return Early: Know Your Bill and Plan Ahead