Self-assessment: get it sorted early

by | Nov 22, 2018 | Blog

The most wonderful time of the year is fast approaching – self-assessment season.

Between Christmas present shopping and social commitments during the last months of the year, you might not feel you have the time or energy to spend filling out a tax return.

At the same time, it’s better to finish it now so you don’t have to rush it in the New Year.

Luckily, we can help take away this stress, by guiding you through the process or simply completing and filing the return on your behalf.

If you’re new to self-assessment or not sure what you need to do, here’s a reminder of the stages of the process and the main deadlines to remember.

Are you included?

The idea behind self-assessment is that it gives you, as a taxpayer, the responsibility of assessing your income and paying the right amount of tax to HMRC.

This means it’s up to you to find out if you need to complete a self-assessment tax return.

You’ll need to send a return if, in 2017/18, you had:

  • income from self-employment amounting to more than £1,000
  • more than £2,500 from renting out property
  • more than £2,500 in other untaxed income, such as tips or commission
  • income from savings or investments of £10,000 or more
  • income from dividends from shares of £10,000 or more
  • profits liable to capital gains tax.

You’ll also need to complete a return if you:

  • were a company director
  • claimed child benefit, and you or your partner’s income was over £50,000.

You can find a full list of circumstances in which you’ll need to file a return on the Government’s website, or you can talk to us if you’re not sure.

Key deadlines

There are a few different dates to keep in mind, which could depend on whether you’re filing online or on paper.

For returns relating to the 2017/18 tax year, the deadlines are:

5 October 2018 to register for self-assessment. If you’ve missed this deadline or any others in the process, it’s best to speak to HMRC as soon as possible.

31 October 2018 to file paper returns.

31 January 2019 to file online returns, and to pay the tax you owe.

Your tax bill will include any tax you owe for the 2017/18 tax year, as well as your first payment on account towards the 2018/19 tax year.

Completing your return

Before you begin, take some time to get all your paperwork together.

This includes all records of income and expenses, so if you’re self-employed you’ll need your invoices, bank statements and receipts, as well as any VAT or PAYE information.

In the event that HMRC decides to check your tax return, you may need to show them these records, so make sure you keep them even after you’ve sent your return.

You’ll also need your unique taxpayer reference (UTR) to hand, which HMRC will have sent to you when you registered for self-assessment.

Using this information, you’ll be able to use the HMRC self-assessment online service to complete and submit your return.

Penalties for late filing

HMRC statistics show that around 745,588 returns were filed late for the 2016/17 tax year. Start well in advance to make sure you don’t end up facing a fine for late filing this year.

There’s an initial £100 penalty if your return is up to three months late, but this will increase the longer you leave it. You could also face additional penalties if you pay your tax bill late.

Contact us for help with self-assessment.

So that’s us. What about you?

Drop us a line for a no-obligation appointment to discuss all things business, from your aims and ambitions to short-term improvements.