As the deadline approaches for your online tax return, it’s important that you are aware of the basics surrounding your self assessment. This includes obtaining a tax return, how to get your tax return to HMRC and the penalties for failing to meet the specified deadlines. If you are self-employed or a company director you might already be used to completing a Self Assessment but if you’re new to the situation, it’s vital that you understand the basics to avoid any potential penalties in the future.
First off, it’s important to remember that you may not actually have to complete a Self Assessment at all. Many people in the UK pay their tax through a tax code which is a lot more straightforward. The tax is calculated automatically through your earnings or pensions and paid accordingly. However, a lot of people have more demanding tax affairs, some of which also have a tax code in place.
Once you’ve understood your situation with regards to taxing and identified yourself as someone who must complete a tax return, your next step is to register for a Self Assessment. Once you’ve registered, HMRC will have your details secured and you can now obtain your Unique Taxpayer Reference. From this point forward, you should receive a letter around spring time telling you to complete your tax return.
So the letter has arrived and you are required to submit a Self Assessment, what now? Don’t be too intimidated by the prospect of filling out a tax return as it’s not a particularly difficult process. Thanks to the use of modern technology, you can choose to send your tax return via post or on the internet. Using the internet is a much easier, faster and more reliable way of getting your Self Assessment to HMRC. You also have three additional months added to your deadline when completing a self assessment online.
Speaking of deadlines, it is vital that you take note of the deadlines that have been put forward by HMRC for your tax return to be completed and returned to them. You have until the 31st January to complete your tax return. If you fail to meet the deadline you will be fined £100 instantaneously. You will also continue to build up penalties as long as your tax return is out of date.
About the Author
Derek Branning is a tax advisor who has provided this article on behalf of Dominic Hill, tax planning accountancy experts based in Eastbourne.