Now we are into the new tax year, it’s time to turn our attention to self-assessment tax returns for 2021/22.
It may seem we have plenty of time; after all, the deadline for submitting a tax return isn’t until January 31, 2023.
But if you are thinking of moving and need to apply for a new mortgage* – or if you need to re-mortgage – then the sooner you complete and submit the return, the better.
The property market is still very buoyant and many people are moving. If this applies to you, and you are in self-assessment, then to apply for a mortgage your lender will want to know your earnings over the past year or two. This means, you’ll want the most up-to-date figures.
And there is another consideration. In the previous tax year, 2020/21, Covid may have negatively impacted you earnings. However, the tax year just gone – 2021/22 – was less affected by Covid restrictions and so your income may have been greater. The higher the income, the higher the mortgage you will be able to apply for.
At Optimum, we also have clients who have delayed re-mortgaging just so they can access their most recent tax return figures, demonstrating their current income levels.
Perhaps you are a property investor, with rental income which may have increased over the last year. Again, the sooner you have completed your tax return, the sooner you will know your tax liability.
Your circumstances may have changed in other ways. You may have changed your business, added a new income stream, or have Government Covid support payments to take into account.
And this is also an opportunity to look at taxable allowances – we’ve written about these before – and make sure you maximise them where possible.
Once we have all the information, we can quickly work out the figures that need to go into the return and advise you as soon as possible on how much tax you will need to pay for this financial year.
To get in touch please email Mandy Gibson, email@example.com, and we will get back to you. We help clients with their self-assessment in Swindon, Cheltenham, and the surrounding area.
* We’re not mortgage advisers at Optimum, so if you are reviewing your mortgage, please seek professional advice.