31 January is the deadline each year for completing a tax return with His Majesty’s Customs and Revenue – HMRC – for the tax year that ended the previous April. It is important that the tax return is completed and any tax due is paid to avoid a fine. This is the case for anyone in the groups that must file for self-assessment:
Self-employed
Whether you work as a sole trader or a limited company, self-employed people who earn over £1,000 must complete a tax return. Even if you are sure you don’t earn enough to pay tax, you must still complete a return.
Business partnership
The rules are different for those in a business partnership, who will need to file for self-assessment if they have a total income of £150,000 or more, pay the high income child benefit charge, or have a capital gains tax liability.
Property rental income
If you own a property you rent out, you will need to file for self-assessment to declare this income, even if you also pay tax through your employment. The exception to this is if you rent out a furnished room in the property in which you live. Under the Rent a Room Scheme, anyone earning less than £7,500 does not have to declare this income.
Savings and investments
If you have income from savings and investments, you will need to check whether you should be filing for self-assessments. Investment income over a certain amount must be declared, so it is worth making use of your ISA allowance for tax-free savings.
Filing for self-assessment
You can file for self-assessment and complete your tax return online. If you need assistance, it may be worth using an accountant. You can search online for one in your area using a term such as ‘accountants Chippenham’, which will produce results such as https://www.chippendaleandclark.com/.
Filing on time is essential, as there is a £100 fine for not filing by the deadline and a further penalty after three months. If you owe tax, there are further penalties and interest applied to the amount you owe.
