The deadline for submitting your online self-assessment tax return is fast approaching. If you’ve never filed a tax return before, here’s what you need to know.
What is self-assessment?
Most people don't need to tell HMRC what they earn. It's dealt with automatically thanks to reporting by employers and other ways of earning money. But some people do need to report what they earn.
The method for doing this is called self-assessment.
Originally everyone submitted their tax return by filling in a form and posting it to HMRC. Today, it's mainly handled online – either via gov.uk or, more recently, by the likes of untied via an app (which makes things far easier! Go to www.untied.io to find out how)
Do I need to file a self -assessment tax return?
There are around 12 million people in the UK who need to file a tax return. These include:
- Self-employed people earning over £1,000
- Property landlords earning over £1,000
- Those on higher salaries above £100,000 a year
You can check if you need to send a self-assessment tax return at the HMRC website address: https://www.gov.uk/check-if-you-need-tax-return
What do I need before I can do my tax return?
Firstly, you’ll need to register for self-assessment – this must be done by 5 October during the second tax year of your business. A tax year runs from 6 April to 5 April the following year.
Then, if you’re using untied, all you need is:
- Your Unique Taxpayer Reference (UTR) – this is a unique 10-digit number that identifies you to HMRC. It's sometimes referred to as "taxpayer number" or just “tax reference”. Everyone using self-assessment should have one as you’ll need it to complete your tax return or if you are contacting HMRC for any reason.
- Your Government Gateway ID – this is your 12-character user ID for accessing HMRC Online Services (this is where you access your tax account). If you don’t have this, you could use untied express submit where we act as a third party and submit your tax return for you.
If you’re not using untied, you will need to gather the relevant paperwork and documents to fill out your self-assessment form. This may include:
- A P60 from your employer (if you have one) showing your income and the tax you have already paid
- A P45 if you have left a job in the current tax year
- A P11D or P9D which shows any benefits and expenses
- Documents detailing your self-employment income, including receipts, bank statements and accounts
- A summary of any rental income and expenses
- Savings and investment statements showing how much you have earned in interest and other income like dividends
How do I do my tax return?
If you’re using untied, all you need to do is tag your income and business expenses and then hit the button to file with HMRC. untied can log your mileage too and apply the correct mileage expense rate for you. We take care of all the calculations and form filling, to make it simple and easy. Our online help and five-star support is available if you need us too.
If you’re not using untied, you’ll need to go to https://www.gov.uk/log-in-file-self-assessment-tax-return and fill in all the relevant sections on all the right forms.
What are the tax return deadlines?
The most important deadline is midnight on 31 January. You need to have submitted your online tax return AND paid your bill for the previous tax year (which includes any first payment on account) by this date.
Other deadlines to be aware of include:
- Register by: 5 October in the second tax year of your business
- Paper tax returns: Due by midnight 31 October
- 2nd payment on account bill: Due by midnight 31 July
When do I need to pay my tax if I’m self-employed?
You need to pay the balance of what you owe by 31 January after the tax year that ended on the previous 5 April.
Some people also make advance payments towards their tax bill (which includes national insurance if you're self-employed) in two instalments – the first due 31 January and the second due 31 July. However, you’d only be expected to make advance payments if your previous tax bill was more than £1,000.
How do I pay my tax bill?
You can pay any tax owed, safely and securely by bank transfer from within the untied app. It's quick and easy. untied makes sure it has the correct reference and it gets sent to the right HMRC account.
If you’re not using untied, you will need to go to HMRC’s website and select a way to pay including by debit or corporate credit card. Note that corporate credit cards incur a fee. Personal credit cards are no longer accepted. You will need your UTR.
If you want to spread your payments over time, you can contact HMRC to agree a payment plan.
Leave things too late and you’ll get a penalty if you miss the deadline for submitting your tax return, or if you are late paying your tax bill.
The immediate late filing penalty is £100. You’ll have to pay more if you pay your tax bill late, or if your tax return is more than 3 months late. You’ll also be charged interest on late payments.
So don’t delay! Take care of your taxes today, the easy way, via untied. Go to untied.io for more information!