Registering for self-assessment

The deadline to register for self-assessment is looming for those who have yet to send or have not completed a tax return before. 

Self-assessment is the process run by HMRC to collect tax from individuals who may own a business or receive income outside of traditional employment. 

A tax return is a form used to report all the income someone has received during the financial year, which runs from 6 April to 5 April.

Recent figures from the Office for National Statistics show the number of people becoming self-employed increased to a record 4.85 million in September 2017.

This article will run you through the process of registering for self-assessment and the requirements to complete your tax return.

Registering 

Registering with HMRC is the first step towards completing your self-assessment tax return, the deadline to complete this is 5 October 2017.

A self-employed person applying for the first time can register online through the HMRC website. 

You will receive a 10-digit unique taxpayer reference and an activation code through the post within 10 working days to set up your online account.

Self-assessment may apply if:

  • you’re self-employed 
  • you have earned £2,500 or more in untaxed income, such as from rental property, savings or investments
  • you have earned £10,000 or more before tax from savings and investments
  • you received profits from chargeable assets (subject to capital gains tax)
  • you have received dividends.

Paper tax return

There are 2 ways to complete your self-assessment tax return – online via the HMRC website or using paper form SA100.

SA100 is the form required for self-employed people to record any income, capital gains or pensions collected during the tax year. 

You may need to fill in additional sections, known as ‘supplementary pages’ if you’re reporting other types of income.

These include:

  • employees or company directors (SA102)
  • self-employment (SA103S or SA103F)
  • business partnerships (SA104S or SA104F)
  • property income (SA105)
  • foreign income or gains (SA106)
  • capital gains (SA108)
  • non-UK or dual residents (SA109).

The paper return must be filed by post to HMRC by 31 October 2017. Alternatively if you miss the deadline you can send your tax return online by 31 January 2018.

Records you need

When completing your paper tax return, it’s important to have the following records to hand:

  • P60, P45 and P11D forms
  • business records
  • profit and loss account
  • bank statements
  • personal pension contributions certificates
  • gift aid donations.

Paying tax

Once you’ve filed your paper tax return by the appropriate deadline, HMRC will then calculate the amount of tax you need pay. 

Your tax bill includes the tax you owe for the previous tax year and if this is more than £1,000, it may be included as an additional payment towards next year’s bill. 

This comes under as ‘payments on account’ and is paid in 2 instalments – on 31 January and 31 July.

We can help you with self-assessment.