Do I need to complete a Tax Return?

Not everyone is required to submit a self assessment tax return to HMRC, but if your tax affairs are more complicated, you will need to register for self-assessment and submit a tax return. Who is likely to need to submit a return? Most income that is earned in the UK is liable to income tax. However, if you are an employee without any other sources of income, the tax you owe will be collected by the PAYE system meaning that you don’t have to submit a tax return. There are many circumstances which require you to submit a return. These include if:

• You are self-employed, which also includes being a member of a partnership or LLP
• You are a director of a company
• Your annual salary is above £100,000 - earning above this threshold may cause higher/additional rate tax which hasn’t been collected through your tax code or a loss of your personal allowance
• You have savings, investments or property income that may have been untaxed when received or not fully taxed at the correct rate
• You receive income from overseas that is liable to UK Tax
• You are liable to capital gains tax (CGT) – disposing of assets such as houses or shares at a profit will cause you to be liable to capital gains tax

These are just a few of the reasons why you may need to be registered under self assessment. How to register? Before you are able to submit a return with HMRC, you will first need to register by providing your contact details, national insurance number and the date at which your circumstances changed which mean you need to submit a self-assessment tax return.  Providing this information to HMRC allows them to set up your records correctly and also ensures that the tax and National Insurance Contributions you pay are correct. You will then be issued with a 10 digit unique tax reference number (UTR). Deadlines The first deadline you will need to consider is the deadline to register for self assessment. It is recommended that as soon as your circumstances change that you register for self assessment to submit a tax return. However, technically the rules are such that you need to notify HMRC within six months of the end of the tax year in which your circumstances meant you were liable to complete a tax return. Once you are registered for self assessment, the next important deadline is the filing deadline. If you file a paper tax return, then the deadline is October 31^st after the end of the tax year, but if you are filing online (which is generally recommended) then the deadline for online filing is January 31^st following the end of the tax year. If you miss the deadlines for submission, then you will be liable to a fixed £100 penalty and possibly further penalties from HMRC. If you would like help getting set up to submit Self Assessment tax returns or more information about tax advisory services, then please contact Wisteria’s personal tax team on 020 8952 0140 or email [email protected]  and a tax specialist will be happy to answer any queries.