The self assessment deadline is on the horizon with 31st January 2018 the date for the 2016/2017 tax year. Here are some self assessment quick facts to help you through the process.
A self assessment tax return is a way some people have to declare their income to HMRC. The criteria needed to complete a return ranges from being a self employed sole trader to a PAYE employee with job expenses like tools.
You have two ways to submit your return: on paper, submitting by post and online. The different processes have different deadlines that you must not miss or you will be penalised with a monetary fine from HMRC.
How do I know if I should fill in a self assessment tax return?
HMRC will usually inform you by letter in April if you are required to submit a self assessment tax return. They will know that you are self employed because you will have already registered as such.
What paperwork do I need?
You need your complete business records of expenditure, including eligible work expenses, and earnings. This does involve amounts like bank account interest, excepting ISAs.
Paper Returns
The deadline for paper self assessment tax returns is midnight, 31st October after the end of the April-April tax year. So for 2016-17 tax year, it is 31st October 2017.
Everyone must fill in the main return (SA100) and whichever extra pages apply to your specific situation. Employment income details should be recorded on SA 102 and income from other sources, including gains and UK property, must go on SA 105. Also, if your total annual sale is over £73,000 you use SA 103F, if it is up to £73,000 you need SA 103S.
SA Online
The deadline for online self assessment tax returns is midnight 31st January after the end of the April-April tax year. For the 2016-17 tax year, the online filing deadline is 31st January 2018.
SA Key step
This key step often catches taxpayers out because it requires some additional time to process. In order to file your return online, you have to register to do so. You should do this well in advance because HMRC need to send you an activation code once they have processed your registration details. For maximum security, this code is sent to you by post. You need to allow time for this process to be completed and bear in mind that the closer to the deadline we get, the busier HMRC will be. You cannot complete an online self assessment tax return without first having this activation code.
If you have all your details to hand, and know exactly which work expenses you are claiming for, it is a relatively simple process to complete as a sole trader. If you are in a business partnership you may need to buy specific software and fill in the correct Partnership Tax Return (SA 800).
Most important ‘need to knows’
- Paper submission deadline is 31st October
- Online submission deadline is 31st January
- You cannot submit online without registering and subsequently receiving your activation code
- HMRC issue fines for missing deadlines and for making mistakes on your paperwork
