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Tax year 2019/20 – a small business guide to UK tax

Knowing key tax dates can prevent fines while ensuring that your business remains organised and well managed. So, which key tax dates should you know?

When do new tax years begin and end?

Although many other countries (including the USA) start their tax year dates on 1 January and end it on 31 December, in the UK the new tax year begins on 6 April and ends on 5 April a year later.

So, 6 April 2019 was the first day of the 2019/20 tax year, while 6 April 2018 was the first day of the 2018/19 tax year (which ended on 5 April 2019).

Changes to new tax rules are often introduced at the beginning of the new tax year (ie 6 April).

What tax dates are important if I’m self‐employed?

HMRC may fine you for missing a deadline, whether for filing a return late or not paying money you owe when required. It’s £100 if your tax return is up to three months late – more if it’s later. If you have a reasonable excuse, you can try to appeal a fine.

To help you avoid fines, it's important to be aware of the following key dates.

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What deadlines are important for limited companies?

You or your accountant must file your Corporation Tax return, in accordance with HMRC requirements, within 12 months of the company’s year-end, as well as calculate how much Corporation Tax is payable.

Limited companies pay Corporation Tax on their profits minus any reliefs.

A company must pay its Corporation Tax bill within nine months of the end of its accounting period. This is normally the same 12 months as the financial year covered by the company’s annual accounts.

What deadlines are important if my business is VAT-registered?

When your taxable turnover for the year reaches £85,000 (2019/20 tax year), you must register for VAT with HMRC (most businesses register for VAT online).

You must pay any VAT you charge to HMRC, after filing your VAT returns, which are usually submitted every three months (ie each quarter).

You pay VAT quarterly, and it should say on your VAT certificate which period you fall into. You’re normally given a full month plus a week from the end of your accounting period to complete the VAT return and make your payment.

You can be penalised if HMRC does not receive your VAT return by the deadline (ie one calendar month and seven days after the end of an accounting period).

From April 2019, most businesses are now required to keep digital VAT business records and send returns using Making Tax Digital (MTD) compatible software. The vast majority of businesses will need to do this for VAT periods starting on or after 1 April 2019. Businesses with a taxable turnover below the VAT threshold can also sign up for MTD for VAT voluntarily.

What is the 2018/19 Corporation Tax rate?

For the 2018/19 tax year in the UK, the Corporation Tax rate is 19% of the company’s annual profits minus any reliefs.