The Complete Self Assessment Tax Return Checklist

Self Assessment is a system which Her Majesty Revenue and Customs (HMRC) uses to collect income tax. This is usually deducted from wages, savings, pensions and other sources of income from individuals and businesses. Obviously, every adult earning over a certain amount is compelled to pay income tax.

If you’re not sure about self assessment and filing tax returns yet, we have got you covered.

Who sends a tax return?

Normally, if you are an employee who has already paid tax through the PAYE (Pay As You Earn) system, you need not fill in a self assessment tax return, unless you earned more than £100,000.

You are required to pay a tax return if:

How to fill your self assessment tax return?

The main section of the tax return is SA100. This covers your taxed and untaxed income, dividends, interests, pension contributions, charitable donations and other benefits. 

If you are self-employed, you will be required to fill in the section SA103. This contains the following sections that you’ll need to fill:

Income: If you’re earning money through self-employment, you are required to enter your turnover under the business income section. This is basically the final total of all your cash inflows during the tax year, before deducting any expenses. As you likely have more than one source of income , you have to enter this amount separately. Another thing to note is that you should state the job you earn most from, as your main source of employment. 

Expenses: You can enter your expenses in two different ways, depending on your income:If your annual turnover is less than £85,000, you simply have to enter your total expenses without categorising them. 

If your annual turnover is greater than £85,000, you must enter an individual amount for each type of expense and show a total at the end.

Self employed income support grant: If you have received the Self Employed Income Support Grant (SEISS), you will be required to disclose this on your self assessment tax return. Although this grant is not to be declared as income, it can be mentioned under an optional question in the section named ‘Other tax adjustments for your business trading name.

If your annual turnover is greater than £85,000, you must enter an individual amount for each type of expense and show a total at the end.

Making use of tax relief

There are a number of tax reliefs available.These are designed to encourage business growth. They are follows: 

Research and development: The UK Government allows your business to claim tax credits for R&D workMany small businesses still haven’t taken advantage of this scheme, designed to reward innovation, and it’s estimated that there is £84 billion in unclaimed tax relief owed to SMEs across the UK.

Employment allowance: If you are paying Class 1 National Insurance presently, you can save up to £3,000 a year through this bill.

Business rates: There is a tax relief for your business in case you own a property which has a rateable value of up to £15,000. In many cases, you can reduce the business rates bill to zero!

Patent tax relief: Another way to reap the rewards of innovating your business is to claim tax relief on profits generated by patented inventions. You will most probably need an accountant’s help but this is very well worth investing if your business holds any patents or not.

Tax deadlines

Tax returns are submitted for tax years instead of calendar years. And this is done in arrears. 

Let’s say that you are paying tax for the year 2022-23, which is from 6 April 2022 until 5 April 2023. If you’re paying a tax return for the first time, you should register for the self assessment by 5 October 2023. 

You need to submit your tax return by 31 October 2023 and 31 January 2024, if you’re filing your return through paper and online mode respectively. Non compliance of these deadlines might charge you with penalty fees so make sure to be ready on time.  

We’re paraphrasing an old saying here: tax is one of life’s few certainties. 

The best way to avoid it coming back to hurt you? Get organised. Quickly. Don’t put it off unnecessarily. 

With wise planning and understanding procedures, you can make your self assessment an easy task to check off. 

What makes it even easier? Getting in touch with a qualified accountant. They know the process like the back of their hand, and can flag up the schemes and tax reliefs that can save you money on your yearly bill. 

Their extensive knowledge of the latest developments in tax law, means you don’t have to worry about compliance either. 

If you need help filling out your tax return, get in touch with Pennyhills today.