January 2018 and Taxes Payable

January is the month when individuals and businesses are required to pay tax.

If your business is a limited company, and your tax year ends 31 March 2017, any corporation tax due for that year is payable 1 January 2018. Unlike your self-employed counterparts (see below) no payments on account are required for 2017/2018.

If you are a self-employed business person, sole trader or in partnership, any balancing payment of self-assessment tax, Class 2 and 4 NIC (for 2016/2017) will be due for payment by 31 January 2018. On the same date, tax payers in this category will   need to make a possible payment on account for the tax year 2017/2018. This is based, initially, as 50% of your actual liability for the previous year, 2016/2017.

You should therefore take a minute to consider what your financial position is for 2017/2018. If you consider that your self-employed profits, or other taxable earnings will be lower during 2017/2018 (as compared to 2016/2017) then you can elect to reduce payments on account for 2017/2018.

We should always be on the lookout for ways to protect our hard-earned cash that is why undertaking this simple review may help to take the sting out of the January tax payment.

You will also be glad to know, that if the results of this exercise show that your profits or taxable income have increased during 2017/2018 (compared to 2016/2017) it is not necessary to increase your payments on account for 2017/2018. However,  self-assessment taxpayers in this position should be aware that any shortfall between payments on account made and the actual liability for 2017/2018 will still be payable, albeit later, will be due on 31 January 2019.

If you feel that your earnings will be lower for 2017/2018 we can help you calculate your liability to see if a valid election to reduce your tax payments next year is a viable option. As that supermarket says, “every little helps”.

Dates to Remember:

1 January 2018- Due date for Corporation tax for companies with an accounting period ended 31 March 2017.

7 January 2018- Due date for filing and payment of VAT for the period ended 30 November 2017, unless you submit a paper return then the date is 31 December 2017.

31 January 2018- Latest date for filing your 2017 online self assessment tax return if you wish to avoid a late filing penalty, Due date for payment of the tax for 2016/2017 and first payment on account for 2016/2017.

Monthly Dates:

19th of the Month: Due date for postal payments of PAYE, NIC and CIS deductions and on-line filing deadline for CIS300 monthly return to HMRC.

22nd of the Month: Due date for electronic payments of PAYE, NIC and CIS deductions to HMRC.