If you are self-employed, are in receipt of Child Benefit and earn over £50,000 pa, and/or have streams of income in addition to what you earn at your employment, HMRC requires you to submit a Self Assessment tax return.
Essentially, this is to determine whether you owe any income tax on earnings that were not automatically taxed at the source.
Figuring out how to file your Self Assessment tax return can be tricky if you have not done it before – and that is what we are here for! Read on for our top tips on how to fill in Self Assessment online:
How to register for a Self Assessment tax return
This is a prerequisite for you to complete the HMRC Self Assessment online. The registration deadline is 5 October, the year after which you are supposed to submit Self Assessment tax returns. For example, for the 2022-23 tax year, you must register by 5 October 2023.
After registration, you will get a Unique Taxpayer Reference (UTR) number in the mail and instructions on how to set up your Government Gateway account. You must have a Government Gateway ID to access the Self Assessment tax return portal.
If you have missed this deadline, make sure you register as quickly as possible and ensure you file your tax return before 31 January. This should mitigate any fines that are due but we recommend seeking the expertise of an accountant like us to help you with this.
Don’t wait to apply for your UTR, it can take HMRC a while to process this for you and you don’t want to miss any other deadline.
What are the Self Assessment tax return deadlines?
The deadlines you need to be aware of every year are:
- 31 October midnight after the end of the tax year for paper returns to reach HMRC
- 31 January midnight after the end of the tax year for submitting online Self Assessment tax returns
- 31 January after the end of the tax year to pay any due taxes
If you are in a business partnership with a limited company whose accounting date is between 1 February and 5 April, you will need to submit a Self Assessment tax return nine months after the accounting date (for paper returns) and 12 months after the accounting date (for online returns).
The penalty for missing a Self Assessment tax return deadline is £100 for a delay of up to three months. The more you delay, the more penalty you will have to pay – check in with your accountant for full details of the penalty structure.
If you know that you are going to be late to complete the HMRC Self Assessment online, you can contact HMRC and request an extension.
Extensions can be granted for reasonable excuses like the death of someone close, a serious illness, an unexpected hospitalisation, computer/software failure, natural disasters, or unexpected postal delays.
However, they would not be granted for situations like your cheque bouncing or incorrectly filing your Self Assessment tax return.
Information needed to file your Self Assessment tax returns
Collect the following before you begin the process of filing your Self Assessment tax:
- 10-digit UTR
- National Insurance number
- Property rental income details
- Self-employment income details
- Self-employment business expenses
- Any charitable contributions or pensions that might get tax relief
- Forms P60, P9D/P11D, and P45 (if you are employed or have been employed during the tax year)
How to complete your Self Assessment tax return
It is fairly easy to fill in the Self Assessment online, as the system does most of the work for you. Here are the sections you will need to pay attention to:
SA100
This covers your income earned from sources other than self-employment or employment, including:
- Marriage allowance
- Charitable donations
- Pension contributions
- Dividends and interest
- Student loan repayments
- Blind Person’s Allowance
- Pensions, annuities, and state benefits
- High-income Child Benefit charge (if you earn more than £50,000 and receive Child Benefit)
SA103
This covers the income you have earned through self-employment. If you have more than one income source – such as income from freelance copywriting and income from selling handmade items online – you must enter the income stream you earn the most from.
This is also where you list the expenses incurred on your self-employment business over the last year. Expenses you can claim on your Self Assessment tax returns include:
- Stock costs
- Travel costs
- Equipment costs
- Business premises costs
- Clothing costs for uniforms
- Staff costs for people you employ
- Advertisement and marketing costs
- Office costs like stationery and phone bills
- Training costs for courses that directly improved the skills you used for your business
SA105
This section of your Self Assessment tax return covers your UK property. You will have to mention the income you have earned from any letting and renting you have done and mention any related expenses such as financial costs, building repairs, and maintenance costs.
SA108
This covers your capital gains from the sales of your assets for profit (tangible or intangible). You can also claim certain kinds of expenses when you fill in Self Assessment online, such as:
- Stamp duty paid when you bought a property
- Price paid when the asset was bought
- Improvement costs, as long as the improvements reflect clearly when you are selling the asset (such as adding bathroom fixtures to an empty house you bought)
If you complete the sale of any UK property after 27 October 2021, you must report any Capital Gains Tax within 60 days of the sale.
How to pay your Self Assessment tax amount
After you complete the HMRC Self Assessment online, you will get a notification about how much tax you owe, and you will need to pay it by 31 January. You cannot pay your tax amount via a personal credit card.
Acceptable forms of payment include cheque, direct debit, debit card, corporate credit card, or bank transfer. If you are filing paper returns, you can use the paying-in slip from HMRC.
Our top tips for Self Assessment tax return
Keep these self-employed tax return tips in mind for a hassle-free process:
- Register for Self Assessment at least one month before the tax deadline.
- Use the free help sheets that HMRC offers when you fill in Self Assessment online.
- Maintain complete and accurate records for at least six years after the tax period in question.
- Take your time with the Self Assessment tax process – come back to it later if necessary.
- Carefully go through each step in the form and ensure you have got everything right before hitting Submit.
- If you make a mistake, file your changes before the Self Assessment deadline for the following year.
Final words
Hopefully, you are clearer now on how to get started with Self Assessment tax returns. Need further assistance? At 3E’S, we specialise in making taxes easy and error-free for everyone, and our experts would be delighted to help with Self Assessment online. Reach out to our expert team to know more about our well-loved and affordable services today!
