Struggling taxpayers across Cumbria may well be able to mitigate the financial impact of the pandemic by filling early tax returns, according to a leading accountancy firm.

Self-Assessment taxpayers, whose incomes fell in the 2020-21 tax year, may be able to reduce their next tax payment to HM Revenue & Customs (HMRC) on 31 July 2021, but need to act now by getting the information to their accountant as soon as possible.

A lot of taxpayers had a very different tax year in 2020-21 and may be due a refund or an adjustment to the second payment on account due on 31 July 2021. Payments on account are determined by estimates based on past income, so providing updated figures from a bad year now could reduce the bill or even lead to a refund.

Graham Lamont, Chief Executive at Lamont Pridmore, said: “Although taxpayers have until January next year to submit their next tax return, many may be able to reduce the amount they have to pay this year by providing HMRC with a clearer idea of their current income by establishing their current profitability or by submitting their return early.”

So far, taxpayers have been getting organised with 950,000 already having completed their 2020-21 tax returns with 63,500 filing their self-assessment on the first day of the tax year, HMRC has revealed.

And with almost 950,000 online Self-Assessment returns received so far this tax year, HMRC is urging others to do the same and file their tax returns early. Given the difficulties of the last year, Lamont Pridmore recommends that taxpayers consult with an accountant to see whether they can reduce their tax payments in July by postponing their some of their payment on account by establishing their current profitability or by submitting an early tax return.