Self Assessment Tax Return Guide

Self Assessment requires self employed individuals in the UK to calculate and submit their tax return details for a given tax year to HM Revenue and Customs (HMRC).

The Self Assessment tax year runs from April 6 to April 5 of the next. The deadline for submitting the Self Assessment tax return is January 31 of the following calendar year.

It is important to meet this deadline in order to avoid any penalties.

The main tax return form is the SA100. You can file this online or if you need a paper copy, call HMRC and request one. Depending on your circumstances, there are supplementary pages for additional forms of income.

If you are self-employed, a business owner, or a property owner with rental income, you must complete a Self Assessment tax return each year. This form requires you to report all of your income and any deductions that you are eligible to claim.

If you are an individual earning over £50,000 per year and subject to High Earners' Tax, or a business owner with profits exceeding £1,000 or VAT registration, you must file a Self Assessment tax return. This allows you to report your income and calculate the tax that you owe.

By completing your tax return accurately and on time, you can be sure that you are paying the correct amount of tax and avoid any penalties.

A Self Assessment tax return covers a range of income sources for individuals and business owners to calculate and pay the tax that they owe. The amount owed will depend on your tax bracket, it covers the following:

• Employment income, including salary, wages, and bonuses
• Self-employment income, such as profits from a sole trader business or partnership
• Rental income from property you own
• Investment income, including dividends from shares and interest on savings
• Pension income
• Foreign income
• Income from trusts, settlements, and estates
• Any other untaxed income, such as tips or commission

In addition to reporting your income, you may also need to report any taxable benefits you've received. 

Not all income is subject to tax. For example, you may be able to claim tax-free allowances for certain types of income. For example personal allowance for income from employment or the rent-a-room allowance for rental income.

If you are unsure whether a particular source of income should be reported on your self-assessment tax return, consult the UK government's guidance or seek advice from a tax professional.

To get started make sure you have all your impotant information to hand.

Your National Insurance number.
Your UTR number
Invoices or other records of income
Receipts
expenses.
Contributions to pensions or charities
P60 and/or P45 forms.

If you are new to the Self Assessment process and have not previously submitted a tax return, then you need to register your details with HMRC before October 5th of the current tax year.

By doing so, you will ensure that you receive your Unique Taxpayer Reference (UTR) number and any necessary paperwork. Failing to register your details by this deadline may result in delays or difficulties in completing and submitting your return.

Paying Self Assessment Tax

The deadline for paying any tax you owe for the previous tax year (known as a balancing payment) and your first installment of advance payments for the current year is usually January 31st. 

The second installment of advance payments for the current tax year is usually due by July 31st.

So in simpler terms:

• By January 31st - Pay any outstanding tax owed for the last tax year that ended on April 5th, plus your first advance payment towards the current tax year. 
• By July 31st - Make your second required advance payment towards your estimated tax bill for the current year.

The January 31st deadline includes both clearing any underpayment from the previous tax year and prepaying towards the current year in progress. The July 31st payment is just your additional prepayment for the current tax period.

You can pay you self assessment tax bill weekly or monthly. 

You can pay your tax bill the same day or next working day through your online bank account, by using online or telephone banking (Faster Payments), CHAPS, or by debit or corporate credit card online. You can also pay the same day if you go to your bank or building society in person, but you will need a paying-in slip from HMRC for this method.

The following options take 3 working days to reach HMRC: paying by Bacs, setting up a Direct Debit if you already have one registered with HMRC, or sending a cheque through the post. 

If you need to set up a new Direct Debit specifically to pay your tax bill, this will take 5 working days to take effect.

Keep in mind if the tax payment deadline falls on a weekend or bank holiday, you need to make sure your payment reaches HMRC on the last working day before the deadline, unless paying by Faster Payments or debit/credit card which can be on the deadline day.

Failing to submit your Self Assessment tax return on time can result in penalties imposed by HMRC, including fines and interest charges.

Even if you do not owe any taxes, missing the deadline for your tax return will result in a penalty of £100.

Additional penalties will be imposed after three months, six months, and one year of lateness. To avoid these penalties and any unnecessary financial burden, it is important to keep track of the deadline for submitting your return and ensure that you are prepared well in advance. By doing so, you can avoid any potential delays or issues.

If you need help preparing your return or have any questions about the process, you can appoint someone to deal with HMRC on your behalf. 

This can be a friend, relative or accountant. Seeking the assistance of a qualified accountant is alway advisable. They will provide expert guidance and ensure that your tax return is accurate and compliant with all legal requirements.

So, if you are struggling with how to fill in your self assessment tax return, don't wait until the last minute. Contact a professional and avoid any potential issues.

Paying an accountant to help you with your self assessment tax return takes all the hassle out of going through all the paperwork for you previous year, as well as deductions.

You will gain from their expertise and experience and be confident that all your information has been submitted accurately.  

If you have any questions about your Self Assessment Tax Returns, get in touch

I will guide you through the process step by step, ensuring that your tax return is accurate and compliant with all legal requirements. With expertise and support, you can have peace of mind knowing that your Self-Assessment Tax Returns are in good hands. 

I understand that having a trusted local accountant is crucial when it comes to maintaining healthy finances and will go above and beyond to make sure that this is the case.

Making sure that no matter your situation, you are being correctly taxed.  I take care of your business and personal tax returns so you don't have to worry about getting it wrong!

With over 30 years of experience serving as an accountant in London for self employed individuals, I have developed streamlined systems to save my clients time while ensuring profits stay where they belong.

- Andrew Passer

Institute of Financial Accountants

The Institute of Financial Accountants (IFA) is an internationally recognised professional accountancy membership body providing dedicated support to SMEs and SMPs.

Taking care of all your self assessment tax needs.