Many individuals and self employed traders struggle to understand the complexities of self assessment tax return and are not able to complete them correctly. In the first year of the Self Assessment regime alone, 775,000 taxpayers received £100 penalties for failing to submit their returns on time, and some 400,000 incurred further penalties because their returns were still outstanding six months later! The constant changing tax legislation means not only that the tax returns are becoming even more difficult to understand but also that taxpayers risk for failing to complete their returns on time or correctly. By law you should file a self assessment tax return if you fall into one of below categories.
- your self-employment income was more than £1,000
- your income from renting out property was more than £2,500 (you will need to contact HMRC if it was between £1,000 and £2,500)
- you earned more than £2,500 in untaxed income, for example from tips or commission.
- your income from savings or investments was £10,000 or more before tax.
- you need to pay Capital Gains Tax on profits from selling things like shares or a second home.
- you’re a director of a company (unless it was a non-profit organisation, such as a charity)
- you, or your partner’s, income was over £50,000 and you’re claiming Child Benefit
- you have income from abroad you need to pay tax on, or you live abroad but have an income in the UK.
- your taxable income was over £100,000
- if you earn over £50,001 in the 2019/20 tax year (£50,001 for 2020/21) and make pension contributions you may have to complete an assessment to claim back the extra tax relief you’re owed
- you are a trustee of a trust or registered pension scheme
- your State Pension was more than your personal allowance and was your only source of income
- you received a P800 from HMRC saying you did not pay enough tax last year.
We as online accountants can save you a lot of time, worry, and money by handling your self assessment tax return for you. We will do all the necessary computations, complete your self assessment tax return , and even offer advice on how you can minimise your tax liability. We can act as your agent, dealing directly with the HM Revenue and Customs on your behalf and, should you be selected for a self assessment inquiry, act for you at any meetings.