Financial Dates and Deadlines Every CEO and Business Owner Needs to Know

First, some background on the financial year’s actual dates. The financial year in the UK begins on April 6th and concludes on April 5th of the following year (in the US, the equivalent period is the 1st of October to the 30th of September). Because Pope Gregory XIII changed the long-used “Julian” calendar of Julius Caesar to the new “Gregorian” calendar in 1582, the financial year started in April in the UK (and several other nations).

Why? Scholars had noticed a rising disparity in the Julian calendar over its 500-year history: it was “shorter” than the solar calendar by 1112 minutes every year, which over five centuries had added up to 10 complete days. That was changed by the Gregorian calendar, which reduced the number of days in a year from 365.25 to 365.2425. This “cutback” of 10 minutes and 48 seconds annually brought the calendar back in line with the solar calendar.

Another change was necessary when the Gregorian calendar was adopted in the UK in 1752 since the financial year had previously coincided with the calendar year, which in those days started on the (old) New Year’s Day (25th March). In order to avoid income losses, the Treasury determined in 1800 that the financial year must begin on April 5th and end on April 4th due to the Gregorian calendar’s new pattern of leap years.

Businesses of the 21st century, as opposed to those in the 18th, benefit from significant technological advancements that were unthinkable in the past, such as accounting software. Modern software developments can automate tasks that would normally need a lot of human intervention for manual data entry. Invoicing and paying clients, handling payroll, keeping track of income and costs, producing quarterly business performance reports and balance sheets, and, above all, maintaining tax affairs accurately and securely are just a few examples of what can now be automated.

The Financial Year: Dates And Deadlines CEOs Must Know

VAT Deadlines: Depending on a company’s VAT return period, standard VAT deadlines change (quarterly, monthly or annual). Quarterly VAT returns must be submitted on the seventh day of the month after the end of the accounting period, or one month plus seven days. After March or June, annual returns are due in one month plus seven days (i.e., the 7th of May or August).

New ‘Making Tax Digital’ VAT Requirements: HMRC advised British businesses to ensure they were ready for ‘Making Tax Digital for VAT from 1st April 2022, when it became obligatory for all VAT-registered companies to submit a digital return. A rule of thumb is that if a firm’s turnover exceeds £85,000 a year, it will almost certainly need to register for VAT. HMRC aims to become amongst the most digitally advanced tax administrations in the world, and compliance with the scheme necessitates businesses ensuring that they have compatible “bridging software” to transmit spreadsheet data to the Revenue’s systems. Alternatively, subscription-based automating accounting software will do the trick.

Payroll Deadlines: For all UK companies with pay-rolled employees, employers must withhold the correct amount of income tax and National Insurance Contributions (NICs) from their pay, submitting them to HMRC by post by the 19th day of each month or by the 22nd day if submitted online.

Employers wishing to register for payroll benefits must prepare an updated payroll record for each employee by the 6th of April, selecting the correct tax code for the new tax year and entering it accurately on the firm’s payroll software.

Full Payment Summaries and Employer Payment Summaries must be submitted in April (in 2022, it was the 19th) when tax and NICs for the financial year must also be paid.

P60s must be given to each employee after the financial year (5th April), with a deadline of 31st May.

That’s a lot to keep track of, and so unsurprisingly, automating software looks like an attractive option for many businesses, helping them to navigate key financial deadlines and avoiding any late payment penalties.