There are now just 3 months left to ensure your Self Assessment tax return for the 2017/18 tax year is completed by the 31 January deadline.
According to HMRC statistics, many people wait until after Christmas to fill in their annual tax return, with 45% of people filing in January 2018.
You can complete your tax return in advance, ensuring that any stress is out of the way before the often busy Christmas period, when tax is usually the last thing on people’s minds. Filling out your tax return in advance will also mean that you can find out how much tax you need to pay ahead of the deadline, and pay any money owed by 31 January.
The minimum penalty for failing to submit your online tax return and pay any tax owed on time is £100, which quickly rises if the return is not submitted promptly thereafter.
Do I need to complete a Self Assessment tax return?
For the majority of people, tax is deducted from their earnings via the PAYE (pay as you earn) system and they do not need to complete a separate tax return.
The HMRC website has a useful tool to tell you whether or not you need to complete a Self Assessment tax return here.
HMRC guidance is that you will need to send a tax return if, in the last tax year:
- your income from self-employment was more than £1,000 – this is your ‘trading allowance’
- you got more than £2,500 from renting out property – you should contact the HMRC helpline if it was between £1,000 and £2,500
- you got more than £2,500 in other untaxed income, for example from tips or commission
- your income from savings or investments was £10,000 or more before tax – this includes money from bare trusts or interest in possession trusts
- your income from dividends from shares was £10,000 or more before tax – tell HMRC if it was over your dividends allowance
- you made profits from selling things like shares, a second home or other chargeable assets and need to pay Capital Gains Tax
- you were a company director – unless it was for a non-profit organisation (such as a charity) and you did not get any pay or benefits, like a company car
- your income (or your partner’s) was over £50,000 and one of you claimed Child Benefit
- you had income from abroad that you needed to pay tax on
- you lived abroad and had a UK income
- your taxable income was over £100,000
- you were a trustee of a trust or registered pension scheme
- you had a P800 from HMRC saying you did not pay enough tax last year – and you did not pay what you owe through your tax code or with a voluntary payment
- your State Pension was more than your Personal Allowance and was your only source of income – unless you started getting your pension on or after 6 April 2016
This list is not exhaustive and more information on who needs to send a tax return is available on the HMRC website here.
This publication has been prepared by Robinson Reed Layton LLP. It is to be treated as a general guide only and is not intended to be a comprehensive statement of the law or represent specific tax advice. No liability is accepted for the opinions it contains, or for any errors or omissions. All rights reserved.