After the party, I resolve to ...
Looking to make a fresh start with your finances in 1997? ... Sort out my tax affairs
Sunday 29 December 1996
Self-assessment will mean a new-style tax return, the chance to calculate for yourself how much you owe, and potentially heavy penalties if you don't keep proper records of your earnings.
The forms for making tax returns will, it is promised, be tailored to individual needs. But for many, self-assessment will mean more, not less, paperwork.
If you are self-employed, you should have received a first "statement of account" from the Inland Revenue. This sets out how much the taxman calculates is due for the year 1996-97; the first instalment is due on 31 January and will probably be in line with the amount you paid on 1 July last year, while the second instalment is due on 31 July.
If you are self-employed and have not received a statement, or you do not understand it, you can telephone the Revenue on 0345 161514 and ask for leaflets giving more information.
If you think you need professional help with your tax affairs, the best way to find an accountant is to ask a friend or colleague for a recommendation. In the meantime, there are some steps you can take to minimise your tax burden. For a start, husbands and wives can elect to be taxed singly, with both eligible for the single person's allowance. If the wife does not have any earnings then the husband can claim the married couple's allowance.
If your partner has minimal or no earnings, consider putting investments and deposits in his or her name to avoid paying income tax on the returns (allowances permitting).
Next, look at savings. Personal equity plans (PEPs) and Tax-exempt special savings accounts (Tessas) are simple ways to invest for the future tax- free.
If you can lock money away for five years in a Tessa, you will receive a much more attractive gross rate of interest than with a conventional deposit.
For higher returns, PEPs are one of the best tax-free investments and can also be a more flexible way of saving for retirement than a pension. Up to pounds 6,000 a year can be invested in UK or continental European shares or unit trusts through a variety of PEP schemes. And a further pounds 3,000 a year can be invested in a single company PEP. The main attraction is that all profits, income or capital gains, are tax-free.
National Savings also offer a range of tax-free options. See our table of Best Savings Rates on page 13 for some of the deals.
You and the taxman in 1997
Pay first instalment of tax on self-employment and investment income which is paid to you gross.
Are you planning any investments by the end of the tax year? Act now if you need funds from a 30-day notice account.
Track down best-buy PEPs; check your pension contributions - remember, you can claim tax relief on top-ups back to 90-91.
By 30 March
Post PEP and pension top-up cheques to ensure they are received before the end of the tax year.
New tax year begins; self-assessment returns start to go out.
Pay second instalment of tax on self-employment earnings.
Deadline for submitting tax returns if you want the Revenue to calculate your tax liability.
- 1 Autistic adults could take pure MDMA to 'reduce social anxiety'
- 2 Stolen Instagram photo sells for $90,000
- 3 Before you complain about your GP, this is what you need to know about actually doing the job
- 4 Charlie Charlie Challenge explained: not a Mexican demon being summoned — it's gravity
- 5 Paracetamol Challenge: Mother of girl killed by overdose pleads with teenagers not to take part
Iran launches anti-Isis cartoon competition 'to expose true nature of Islamic State'
'Don't blame all men for rape' campaign backfires spectacularly
Fifa corruption arrests: How Chuck Blazer rinsed money from the beautiful game
Fifa corruption live: Uefa to consider pulling teams from Fifa tournaments if Blatter stays
Ukip MP Douglas Carswell says he felt his safety was 'seriously at risk' after he was surrounded by anti-austerity protesters
EU referendum: David Cameron's rules are a 'democratic disgrace', says French-born Scottish politician set to be denied a vote
The day that Britain resigned as a global power
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Australian man punched in the face for defending Muslim women from abuse on train
A nation of inequality: How the UK is failing to feed its most vulnerable people
David Starkey 'tells Amal Clooney to shut up and stop over-promoting human rights'
iJobs Money & Business
£30 - 35k: Guru Careers: We are seeking a Pricing Analyst to join a leading e-...
£20000 - £25000 per annum + OTE £45K YR1: SThree: At SThree, we like to be dif...
£20000 - £25000 per annum + competitive: SThree: Did you know? SThree is a mul...
£55 - 65k (DOE): Guru Careers: A unique opportunity for a permanent C# Develop...