Most people associate self-assessment tax returns with the self-employed, and think the deadline is in January.
But there are lots of other reasons why you may need to submit a tax return to HMRC - and there’s a deadline in October too.
Anyone who needs to register for self-assessment for the 2023-24 tax year must do so by 5 October 2024. The deadline to then file a tax return online and pay any tax owed is 31 January 2025. Taxpayers who make payments on account make a second payment by 31 July every year.
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About 12 million people file a tax return each year, and 97% of customers do so online. There is an earlier deadline of 31 October for those submitting a paper tax return.
“Self-assessment angst usually strikes in January, but there are some people who need to get their skates on well before that, because they need to register for self-assessment before the deadline on 5 October. Those who have started a business or partnership are likely to be well aware of this, but there are other groups of people who may have no idea they need to sign up for the first time,” comments Sarah Coles, head of personal finance at the wealth manager Hargreaves Lansdown.
As HMRC puts it: “New self-assessment customers could be someone who has set up a side hustle to earn money in addition to their PAYE job or disposed of crypto assets; they may be newly self-employed or a new landlord renting out property. Whatever the circumstances, if a customer has any income that they have not already paid UK tax on, they need to register for self-assessment.”
Even if you don't owe any tax, you may still need to file a return to claim a tax refund, claim tax relief on business expenses, charitable donations, pension contributions, or to pay voluntary Class 2 National Insurance contributions to protect your entitlement to certain benefits and the state pension.
Here are 11 reasons for registering, from the well-known like becoming self-employed or a buy-to-let landlord, to more surprising, lesser-known, reasons.
Note that the list isn’t exhaustive, there are plenty more reasons for filing a self-assessment return, due to our complex tax regime! You can use HMRC’s online checking tool to assess whether you need to complete a tax return.
1. You work for yourself or you’re in a business partnership
As you don’t pay income tax through PAYE, you need to tell HMRC how much you earned and then pay any tax via self-assessment. You will likely have to make two payments each year, one by 31 January and the other by 31 July.
2. You’re a buy-to-let landlord
If you’re earning money through renting out a property, or several properties, you need to tell HMRC so you can pay the correct amount of tax on this income.
3. You’re a higher-rate taxpayer who pays into a pension
If you pay into a personal pension like a Sipp, or your employer runs a scheme on a “relief at source” basis, you’ll get basic-rate tax relief and need to claim the rest from HMRC.
If your employer makes contributions before tax (known as “net pay”), you’ll receive the full pension tax relief automatically and you don’t need to tell HMRC. The same is true if you have a salary sacrifice arrangement. If you’re not sure how your workplace pension works, check with your HR team or your pension provider.
If you have extra relief to claim, you can either do a tax return, or if you’re employed you can write to HMRC and receive a one-off payment. Coles notes: “However, if you opt for a letter you’ll need a new one every time your salary or contributions change significantly, which might actually end up taking more effort.”
4. You’re a higher-rate taxpayer who gives to charity
You automatically get 20% gift aid when you donate to charity, but you can claim back the rest of the tax relief through a self-assessment claim.
However, if this is your only reason for completing a tax return, there are alternatives. You can fill in a separate form to make the claim, or contact HMRC and ask them to amend your tax code instead.
5. You receive child benefit and you or your partner have an income above £50,000
This means you’re subject to the high income child benefit tax charge. For the 2023-24 tax year, this kicks in at £50,000 annual earnings, and means you have to repay 1% of the benefit for every £100 you earn over the threshold. You need to complete a tax return to find out how much you need to pay and to pay the charge.
Bear in mind that once you earn above £60,000, you’ll need to repay all your child benefit, so most parents find it easier to claim it but tell HMRC not to make any payments – which saves the bother of repayment but means you still get National Insurance credits, which count towards your state pension.
The £50,000 threshold for child benefit rose to £60,000 in April this year, and the top of the taper rose from £60,000 to £80,000. So, some good news for parents for the 2024-25 tax return.
6. You make more than £6,000 in capital gains
Capital gains are the profits you make when you sell something that’s increased in value. It also applies if you give something away to anyone other than a spouse or civil partner during your lifetime, so even if you’re not personally making the profit, the tax is due.
The capital gains tax threshold for 2023-24 was £6,000. If you made more capital gains than this, you need to complete a tax return and pay capital gains tax. The tax-free allowance was reduced to £3,000 in April, so do watch out for next year's tax return.
7. You make a capital loss
This information also goes on your tax return. If you make a loss you can set it against other gains in the same tax year, or carry it forward to offset losses in a future tax year.
Note that if you’ve never made a capital gain and you don’t otherwise need to do a tax return, you can write to HMRC instead.
8. You make £10,000 in interest and/or dividends
If you make money over your personal savings allowance (£1,000 for basic-rate taxpayers, £500 for higher-rate taxpayers and £0 for additional-rate taxpayers) or dividend allowance (£1,000 this year), you will usually have to pay tax, but if you’re employed you can ask HMRC to adjust your tax code to take the money.
If you have interest over your allowance, you’re not employed, don’t get a pension and don’t complete a tax return, HMRC will contact you at the end of the tax year with a tax demand, if applicable.
However, if you need to pay tax on over £10,000 in dividends, you’ll need to fill in a self-assessment tax return.
9. You invest in an EIS or VCT
Some investments come with tax benefits that you can claim via self-assessment. However, if this is your only reason for filing a tax return, you can arrange for the tax to be repaid through an amendment to your tax code.
10. You have a side hustle and make more than £1,000 a year
Everyone has a £1,000 trading allowance, which can cover things like selling unwanted items through eBay or Vinted, or making and selling stuff in your own time. Any more than this and you normally need to do a tax return.
11. You rent out a spare room, and make more than the rent-a-room limit
You can make up to £7,500 a year tax-free by renting out a furnished room in your home, including through Airbnb. Any more than this, and you need to register for self-assessment.
TWO MORE SELF-ASSESSMENT TIPS
If you think you no longer need to complete a tax return for 2023-2024, you need to tell HMRC before the deadline on 31 January 2025 to avoid any penalties or needing to complete a tax return. HMRC has produced two videos explaining how customers can go online and stop self-assessment if they are self-employed and those who are not self-employed.
Customers should be aware of the risk of falling victim to scams. Never share your HMRC log-in details with anyone, including a tax agent, if you have one. There is more scams advice on this HMRC page.
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