Heide’s Blog, 22nd January, 2021

Have you submitted your tax return for year ending 2020
Your tax return is due!

This week’s blog investigates your annual personal tax return, due on 31st January, and why you should aim to submit it earlier if possible.

How can it possibly be the middle of January already? In the last lockdown, time seemed to pass exceedingly slowly (but the weather was much better so that was ok!) but this time it feels like warp speed!

With the rush for home buyers to complete their purchases by the March deadline to benefit from the stamp duty holiday, combined with Covid-related delays in all things mortgage-related, here we are already.

This blog, however, is not about the stamp duty holiday. Much more pressing is the HMRC self-assessment deadline of 31 January to submit and pay your taxes for the year ending 31 March 2020. If you live in fear of being chased by the taxman, your tax return may already be done and dusted. However, according to The Guardian, HMRC expects 12.1 million tax returns to be filed this time around and it is thought that more than 4 million people still have to submit their returns.

Due for submission by 31st January


HMRC has already confirmed that they won’t be fining people who file their taxes late and have a Covid-related excuse.  So, if like me, you are home schooling or you have been ill, you can apply to get your penalty cancelled.  Honestly though, if you don’t have a good reason, why not use this lockdown to get it out of the way?  If you are concerned that you can’t afford your tax bill, doing your tax return now means that you can set up a payment plan over 12 months, provided you owe less than £30,000.  If you leave it too late, you won’t have that option.  Just imagine that wonderful feeling of relief once it’s done 😊.



If you are self-employed and trying to reduce your tax bill, one way to do this is to pay more into your pension.  You can deduct your pension contributions from your taxable income.  For example, if your annual earnings were £50,000, and you contribute £5,000 into your pension, this reduces your total taxable income to £45,000.  So instead of giving money to the taxman, you are saving for your future.  It won’t help for 2019/2020 but it is worth thinking about now for the next tax year.


If you are self-employed and planning to apply for a mortgage, you may be better maximising rather than reducing your taxable income. Remember that mortgage companies will look at your income when they decide what you can afford to borrow and may also want to look at your bank statements to check your outgoings.  I wrote a specific blog on getting a mortgage when you are self-employed, so it might be worth having a read if this applies to you.  It is definitely worth getting to know your mortgage advisor in advance and getting some advice so that you can be prepared when the time comes.

Personally, I’m one of the people that lives in fear of the taxman, so I like to get my tax return done early.  Whatever your situation, I hope my blog has given you some food for thought and some encouragement to use this lockdown to submit your tax return on time.


Tax treatment varies according to individual circumstances and is subject to change.


Get in touch if we can help in any way.

Telephone: 01525 309300

Mobile: 07903 302895

Email: heide@swift-mortgages.com

Website: www.swift-mortgages.com



Heide’s Blog, 22nd January, 2021


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