Do I Have to File a Tax Return?
Whether or not you need to file a tax return in the UK depends on your individual circumstances, such as your income, residency status, and whether you are self-employed or have other sources of income. If you’re new to doing your own taxes, here are some general guidelines.
What’s your employment status?
The source of your income will determine how your tax is filed and processed. Here are the most common examples:
Self-employed: If you’re self-employed in the UK, you are generally required to file a tax return each year, regardless of your income level.
Employed: If you’re employed in the UK and your income is taxed through PAYE (Pay As You Earn), you may not need to file a tax return if your income is below the personal allowance threshold and you have no other sources of income.
Other sources of income: If you have other sources of income in addition to your employment, such as rental income, dividends or capital gains, you may need to file a tax return.
High income: If your income is above a certain threshold, you may also need to file a tax return. For example, if your income is over £100,000, you may be required to file one.
Non-residents: If you are a non-resident of the UK but have UK income, you may also be required to file a tax return.
It’s important to check with HM Revenue & Customs (HMRC) to determine if you are required to file a tax return. If you are, you must do so by the deadline, which is usually 31st October for paper returns and 31st January for online returns. Failure to file a tax return or pay taxes owed on time can result in penalties and interest charges.
How do I file a tax return?
In the UK, you can file your tax return online (which we highly recommend) or on paper (form SA100). Here are the steps to file a tax return online:
Register for self-assessment: Before you can file your tax return online, you need to register for self-assessment with HMRC. You can register online using the HMRC website.
Gather your information: You will need to have all the necessary information and documents to complete your tax return. This includes information on your income, expenses, and any tax deductions or credits you are eligible for.
Use the online service: Once you have registered for self-assessment, you can use the online service available on the HMRC website. The online service will guide you through the process of completing your tax return, step by step.
Submit your tax return: Once you have completed your tax return online, you can submit it to HMRC. You can do this by clicking the "submit" button on the online form.
Pay any tax owed: If you owe any tax, you will need to pay it by the deadline, which is usually 31st January. You can pay online, by phone, or by post.
If you prefer to file your tax return on paper, you can download the forms from the HMRC website or order them by phone. The process for completing and submitting a paper tax return is similar to the online process, but it may take longer for HMRC to process.
What happens if I don’t file my tax return?
If you’re required to file a tax return and fail to do so, you may face penalties and interest charges. The exact penalties depend on how late the return is and whether you owe any tax. Here are some possible consequences of not submitting a tax return on time:
Late filing penalties: If you fail to file your tax return by the deadline, you will instantly be charged a penalty of £100. This penalty applies even if you have no tax to pay or have already paid the tax you owe.
Additional penalties: If you continue to delay filing your tax return, additional penalties may apply. For example, if your return is more than three months late, you may be charged an additional penalty of £10 per day, up to a maximum of £900.
Interest charges: If you owe tax and fail to file your tax return on time, you will be charged interest on the tax owed. Interest accrues on a daily basis, starting from the due date.
Enforcement action: If you continue to ignore your tax obligations, HMRC may take enforcement action against you, such as seizing assets or taking legal action to recover the tax owed.
Ask us about self-assessment tax returns
Managing your own tax returns can be confusing, stressful and time-consuming, which is why we’re here to take this crucial task off your to-do list. To find out more, call our Northern office on 01482 235575, our London office on 0207 885 0605, or fill in the contact form below.
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