Tax Day!

The end of the tax year here in the UK is 5th April. Only those who are self-employed or company directors etc have to file tax returns, everyone else is on PAYE (Pay As You Earn) and has it taken from their salary so don't have to do anything.

For those of us who have to file tax returns there are two dates for filing. If we file by 30th September, the tax owed will be calculated and billed for payment in the following January. However we can file as late as 30th December, but we would then have to calculate our own tax and still get the payment in by the end of January. If we fail to get the tax return and payment in by 1st February we would be charged a £100 penalty.

The times are actually fairly generous. With the tax year ending in April it should be fairly easy for individuals to get their accounts sorted out and their tax returns filed by the end of September (almost six months). Those with more complicated tax issues will use an accountant who can calculate the tax anyway, so they have until the end of December (almost nine months). Then payment must be in by the end of January (almost ten months).

My tax return will probably be filed before the end of this month. I'm just waiting for a couple of things to arrive so I can finish my accounts. I like to get it out of the way and get on with the next year, rather than hanging around for the deadline. Then I just wait for the tax calculations which takes a month or two, then the bill will arrive just after Christmas and will be paid in mid January.

The worst part is filling out the multi-page forms, which I don't understand. However I have a friend who does, and he helps me sort it all out each year. He is good at sorting out what can be offset against tax to minimise the profit and thus minimise the tax. As self-employed my accounts show a modest profit each year, which I pay tax on. It's a lot less than I would pay if I was employed and on PAYE, so I can't complain.

 

The Canadian system sounds more like the US one... We operate on a calendar tax year, so our 2006 tax returns (which everyone needs to file) are due April 30. (I'll likely be doing mine on that last weekend too!)

 

I'm also from Canada. We normally have taxes deducted as we go from our pay cheques, but then there's a bunch of random deductions / refunds that have been tacked on over time, so we end up with this stupid bureaucratic tax industry as a result.

Anyways, as Jim mentioned it's due April 30th (if you owe money).

I did mine a couple weeks ago. Our family uses a program called U-file which is one of the least expensive ones, lets you do 5 returns for people making over 25K, and unlimited under 25K, and it will import appropriate carry over numbers from your previous year's file. There's also a free program called "Studio tax", but I don't like the layout as much.

It was basically a 15 minute job to go through all my receipts, type in all the numbers, fill out a couple fields, and send it off electronically to the Canadian Revenue Agency. I should get my refund directly deposited in my bank account in the next couple days. I highly highly recommend using software instead of paper. A couple years ago I did my return by paper (yuck!) Never again! I was looking through the paper copy I printed from u-file trying to find the number of a credit that I'm transferring to my parents. Looking through the forms there really is an excessive amount of mindless calculations.

Unless you have a really complex return, there's no point hiring a professional to do it. You're much better off doing it yourself with inexpensive (or free) software.

 

Yeah, here in the U.S., your tax is generally deducted from your paycheck, but at the end of the year, you still have to file a return, mostly for the government to check up on you to make sure you paid enough. The tax year is the calender year, then you get until April 15 (16th this year) to file your return and pay any tax you were short. If you're self-employed in the U.S., you have to pay an estimate of your taxes every quarter, then if you're too far off on your estimates, you get sacked with a penalty (yep, been there, done that, and couldn't afford the t-shirt when I was done).

 

Eh, I filed my state taxes what feels like forever ago and havent gotten them yet. Federal on the other hand, I dont even know where to send the stupid thing too, eh I think I'm screwed. Oh well, its only 150 bucks

 

I'm lucky I don't have to worry about tax as yet!

 

I have extra taxes taken out of my check at work so that I don't have to claim my earnings in my limo service. It makes everything go a lot better this way.

 

Yes, yes you are! Not that it's usually that traumatic... just a hassle for most people, I think.

 

You're serious?! But what if you have investment income or tuition credits from attending uni or you've made charitable donations? That's sounds blissfully simple but incredibly weird.

From Canada here... so April 30th as people have mentioned. I always use QuickTax, which is by the same company (Intuit) that makes Quicken, which is what I use to track all my money stuff.

Anyway, yeah, this year I'm getting a pretty big refund because I made a big donation to a charity in my mother's name using money I inherited when she died. Donations are amazing... any amount you donate over $200 you get back at the highest tax rate, which is 29%. So if you donate $1000, you get like $262 back! (The first $200 you get back at 15%, which is the lowest tax bracket.)

Okay, I should stop being tax-nerdy! :eusa_danc

 

There are several circumstances when you do have to file a tax return here. If you have stocks and shares or other investments that are not tax-paid for example. A regular savings account at a bank has tax paid on the interest by the bank, so that doesn't need a tax return filing.

Charity donations up to your full time income do not require submitting a tax return, and the charity claim back the income tax paid on it too.

Generally if you are an employee with no unusual financial affairs you don't need to file a tax return. I don't know the figures but I would guess that applies for at least 75% of the population.

 

Wow... that seems so much easier than the Canadian and US systems.