Self-Assessment Tax Returns – What do I need to do?
Self-assessment is a system HM Revenue and Customs (HMRC) uses to collect income tax. Tax is generally deducted automatically from wages, pensions and savings. However people and businesses with other income must report it in a tax return.
When does the tax year run
The tax year runs from 6th April to 5th April the following year.
If you need to fill in a self-assessment tax return, HMRC should notify you and ask you to complete a paper tax return or you can make an online tax return. Once you have registered, HMRC will issue you or your accountant with a 10-digit unique taxpayer reference number.
Who must complete a tax return form
The main tax return is SA100. You must submit an SA100 form if you’re:
- A company director, minister of religion, Lloyd’s name or member
- Receiving an annual income of £100,000 or more
- Receiving income from savings, investment or property
- Planning to claim expenses or reliefs
- Receiving child benefit and income is above £50,000
- Receiving foreign income
- Paying capital gains tax
- A trustee
How long shall I keep my business expense receipts
To ensure your tax return is correct, you are expected to keep records, which you may need to produce if your tax return is questioned. Your records should include details of all your sales and takings as well as a record of your purchases and business expenses. These records should be kept for a minimum of six years, however it may be worth keeping them for 20 years. This is because this is the time limit for an investigation if HMRC suspects fraud.
Using software or paper forms
You can choose to send your self-assessment tax return using software or by paper forms, although HMRC will soon be phasing out paper versions.
If you are sending your self-assessment tax return by a paper, you must submit it by 31st October otherwise you will receive a fine of £100.
Ensuring the information on your tax return is correct, will save you time and money, therefore it is imperative to talk to your accountant to ensure you only pay the required amount of tax.
For more information, please get in touch!