Should You Take Your Tax Filing Online?
In today's digital age, the way we handle our finances, including how we file our taxes, has transformed significantly.
At Blue Rocket Accounting, we've embraced this digital revolution, understanding that it brings convenience and efficiency to our clients.
However, the question remains: should you take your tax filing online?
This is a complicated decision, and there are pros and cons to either method. In this blog, we’re going to break it down into these categories and help you make up your mind on the best way to file your tax returns.
But first, let’s look at just what these two methods look like?
Online vs. Physical Tax Returns: Different Methods
When comparing online and physical (traditional) tax filing methods, it's important to understand what each process entails.
Here's a breakdown of both methods:
Online Tax Filing
- Digital Platform Use – This includes using software or web-based services such as Xero and Quickbooks. These platforms are made to offer a streamlined and efficient approach to tax filing and often include guided setups to help.
- Document Management – All of your tax documents can be uploaded digitally. Not only that, but in most cases you can e-sign your tax returns, eliminating the need for in-person signatures altogether.
- Automated Calculations – When it comes to working out your figures, online software will automatically calculate them, making it quick and easy. They should also have built-in error checking to notify you if anything looks amiss.
- Electronic Submission – Your tax returns will be submitted directly to HMRC electronically. This will mean that in most cases you receive immediate confirmation of submission and processing.
Physical Tax Filing
- Paper Forms and Manual Completion –This involves filing out paper forms by hand and manually calculating taxes and refunds.
- Document Submission – When submitting your forms, this must also be done physically, either delivered by hand or sent in the post. These will also require a physical signature.
- Consulting with Professionals – As most of the legwork has been done by yourself, and you don’t have software to help, it is always wise to consult a professional to ensure everything is in order and done correctly.
- Processing – The processing of physical tax returns can take longer, especially for refunds. There is also a risk of postal delays to consider if submitting by this method.
So, now you know how each method works, what are the benefits and downsides of online tax filing?
The Benefits of Online Tax Filing
Efficiency and Speed
Online tax filing is known for its efficiency.
You can file your taxes from the comfort of your home, without the need for physical paperwork.
The process is faster, and refunds are typically processed more quickly.
Accessibility and Convenience
With online filing, you can access your tax documents anytime and anywhere.
This flexibility is particularly beneficial for busy individuals who can’t afford to spend hours at an accountant's office and means that if anything does come up, they are only ever a few clicks away from finding the information they need.
Accuracy and Less Room for Error
Online tax software often comes with built-in tools to help reduce errors.
These programs can automatically check for common mistakes, ensuring that your tax return is accurate.
This can save you lots of time and hassle in the long run as it can take weeks and months to solve disputes if you submit an incorrect tax return.
Tax laws change regularly.
Online platforms are updated to reflect the latest tax codes, ensuring that you're always compliant with current laws.
This is one of the hardest parts about submitting your tax returns manually, and even things like notifications when the date for filing your returns is due can be a big help with an online system.
The Drawbacks of Online Tax Filing
While reputable online tax services offer strong security measures, the risk of data breaches and hacking still exists.
It's crucial to choose a platform with robust security protocols.
While this can be seen as a concern, issues such as damage to your documents when kept physically do also occur.
Complexity of Tax Situations
If you have a complex tax situation, such as owning a business or having multiple income streams, online tax software might not be sufficient.
While it can streamline your different revenue streams, it may not tick all the boxes needed for really intricate situations.
In these cases, professional guidance is often necessary.
Lack of Personalised Advice
Online tax filing lacks the personalised touch.
You won’t have a dedicated professional who understands your unique financial situation and can offer tailored advice.
This can be one downside but doesn’t need to be as accountants can work with you and your online presence.
The Blue Rocket Accounting Approach
At Blue Rocket Accounting, we recognise the value of technology in tax filing.
We also understand that every individual's financial situation is unique.
That's why we offer a blended approach:
- Technology-Driven Solutions: We utilise the best of online tax software to provide efficient and accurate tax filing services. Our clients benefit from the convenience and speed that technology offers.
- Personalised Professional Guidance: Our team of experienced accountants is here to offer personalised advice, especially for complex tax situations. We believe in the power of human touch and professional expertise and use our knowledge to always simplify and make the most of your financial situation.
- Security as a Priority: We ensure that all online tax filing services are secure and compliant with the latest data protection regulations.
Online Tax Filing with Blue Rocket Accounting
So, should you take your tax filing online?
The answer depends on your individual needs and circumstances.
In our opinion, the benefits of this approach far outweigh the negatives, and that’s why we use online software to maximise all of our client’s tax returns.
We are here to support you, whether you choose to file online or need our expert guidance with physical submissions.
If you want to know more about what we can do for you and your taxes, then get in touch today.