Starting an agency is an exciting venture, but ensuring you meet all tax compliance requirements is critical to your long-term success. From filing VAT returns to meeting self-assessment deadlines, staying on top of your tax obligations will protect your agency from penalties and keep your finances in order. This blog will guide you through the essential tax deadlines and due dates every new agency owner should be aware of.

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Understanding VAT Registration and Filing Deadlines

Value Added Tax (VAT) is a critical consideration for many agencies, and understanding the registration and filing requirements is essential.

• VAT Registration: You must register for VAT if your agency’s taxable turnover exceeds the current threshold of £90,000 within a 12-month period. If you expect to exceed this threshold within the next 30 days, you must register immediately.
• VAT Return Filing and Payment: Once registered, VAT returns are usually due every quarter. The deadlines are one month and seven days after the end of your VAT accounting period. For example, if your VAT period ends on 31st March, your VAT return and payment are due by 7th May. Missing this deadline can result in fines and interest charges.

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Self-Assessment and Income Tax Deadlines

If you’re operating as a sole trader or a partner in a partnership, self-assessment is a key aspect of your tax obligations.

• Self-Assessment Registration: You must notify HM Revenue & Customs (HMRC) of your need to file a self-assessment tax return by 5th October after the end of your first tax year. For example, if you started your agency in May 2024, you must register by 5th October 2025.
• Self-Assessment Filing: The deadline for submitting your online self-assessment tax return is 31st January following the end of the tax year. For the 2023-2024 tax year, the deadline is 31st January 2025. Paper returns are due by 31st October of the same year but we wouldn’t recommend using paper returns anyway!
• Payment Deadlines: Income tax payments are typically due in two instalments—31st January and 31st July each year. The January payment includes any outstanding tax owed for the previous year and the first payment on account for the current year. The July payment is the second payment on account.

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Corporation Tax Deadlines for Limited Companies

If your agency is structured as a limited company, corporation tax is an important responsibility.

• Corporation Tax Registration: After incorporating your agency with Companies House, you must register for corporation tax within three months of starting to trade. HMRC will issue a Unique Taxpayer Reference (UTR) for your company, which you’ll need for all future tax dealings.
• Corporation Tax Payment Deadline: Corporation tax is due nine months and one day after the end of your company’s accounting period. For example, if your accounting period ends on 31st March 2025, your tax payment is due by 1st January 2026.
• Company Tax Return Filing: You must file your Company Tax Return (CT600) within 12 months of your accounting period’s end. Missing this deadline can lead to penalties, so it’s crucial to file on time.

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PAYE and Payroll Deadlines for Employers

If your agency employs staff, you’ll need to manage PAYE (Pay As You Earn) to handle income tax and National Insurance contributions.

• PAYE Registration: Register as an employer with HMRC before your first payday. PAYE ensures that you deduct the correct amount of income tax and National Insurance from your employees’ wages.
• PAYE Reporting: Submit Real Time Information (RTI) to HMRC every time you pay your employees. This report must be sent on or before each payday.
• PAYE Payment Deadlines: PAYE payments to HMRC are due by the 19th of the following month (or the 22nd if paying electronically). Late payments can result in interest charges and penalties.
• Pensions Auto-Enrolment: Remember to comply with pensions auto-enrolment requirements by enrolling eligible employees into a workplace pension scheme and making the necessary contributions.

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Key Points

Staying compliant with tax deadlines and due dates is essential to running a successful agency. Here’s a quick summary of the key dates you need to remember:

• VAT: Register if your turnover exceeds £90,000 and file returns quarterly, with payments due one month and seven days after the VAT period ends.
• Self-Assessment: Register by 5th October, file online returns by 31st January, and make payments by 31st January and 31st July.
• Corporation Tax: Register within three months, pay tax nine months and one day after your accounting period ends, and file your return within 12 months.
• PAYE: Register before your first payday, report in real-time, and make payments by the 19th of the following month (22nd if electronic).

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FAQs

Q: What happens if I miss a tax deadline?

A: Missing a tax deadline can result in penalties, interest charges, and in severe cases, legal action. It’s crucial to stay on top of your obligations.

Q: How can I ensure I don’t miss any tax deadlines?

A: Using accounting software like Xero can help you track deadlines and automate reminders, ensuring you stay compliant.

Q: Can I extend a tax deadline if I’m struggling to pay on time?

A: HMRC may allow a time-to-pay arrangement if you’re struggling to meet a payment deadline, but you need to contact them as soon as possible to discuss your situation.

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Navigating tax compliance can be complex, but you don’t have to do it alone. Book a consultation with Right Recruiters today to receive personalised advice on managing your agency’s tax obligations and staying on top of deadlines. We’ll help you ensure your agency remains compliant, so you can focus on what you do best—growing your business.

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