If you’re a sole trader or self-employed, responsible for calculating and paying your income tax, you must submit a self-assessment tax return. This may seem like a daunting prospect, but this blog aims to alleviate some of those fears by providing a few hints and tips on how to get started.
Self-assessment deadlines
Firstly, the tax year runs from 6 April to 5 April, so all income and expenses for this period should
be included in your tax return.
If you choose to complete a paper return, it must be submitted no later than 31st October the following financial year. If you are filing your tax return online, you have until 31st January of the
following the end of the tax year to submit your return.
Whichever way you choose to complete your return, the deadline for paying your tax is the 31st
January.
Registering
If you are completing your tax return for the first time, you will first have to register for Self Assessment. This can be done by post, by phone or via the Government website. You need to register for Self Assessment by the 5th October following the end of the financial year – if you miss this deadline you may have to pay a fine.
Once you’ve registered you will receive your Unique Taxpayer Reference (UTR) in the post. You’ll need this UTR to file your return. You will also need to create a Government Gateway account. You should be sent information on how to do this with your UTR. You are now ready to submit your first Self Assessment Tax Return!
Completing your Self-Assessment Tax Return
Before you start completing your Self Assessment Tax Return, it is a good idea to gather all the information you need. This will include:
- Your UTR
- National Insurance number
- Details of income from the relevant tax year. This includes income from your business, property, and savings
- Details of contributions to a pension or a charity, which may be eligible for tax relief
- Details of expenses associated with your self-employed business
If you’re completing your Self Assessment Tax Return yourself, there is a lot of helpful information
and guidance on the HMRC website.
The main section of the Self Assessment Tax Return covers:
- Dividends
- Student loan repayments
- Interest
- Pensions
- Annuities
- Charitable contributions
- Tax relief and allowances
You may also need to complete one or more of the following sections:
- Employees and directors
- Business partnerships
- UK property income
- Foreign Income
- Capital gains
Only complete those sections that are relevant to your situation. You can skip those that are not. When completed, check your tax return carefully before clicking ‘Submit’. Once submitted, HMRC will calculate the tax you need to pay.
Employing a professional
You can employ the services of a professional accountant to complete and submit your Self Assessment Tax Return. They will require the same information as if you were completing the return yourself.
Key take aways
- Remember to register for Self Assessment before the 5th October if you are completing a tax return for the first time.
- Have all the information you think you may need ready before you start completing your tax return – this will make the process easier and quicker.
- Check and double check your completed tax return to ensure all the information you have inputted is correct, and you haven’t missed any relevant sections.
- Remember to submit your completed tax return before the relevant deadlines to avoid a fine – the 31st October for paper returns and the 31st January for electronic returns.
- Once your tax has been calculated, remember to pay your tax bill before the 31st January – again, if you don’t you may face a fine.
- Consult a professional accountant if you are unsure about anything – they will be able to guide you through the process and even submit your tax return for you
