What Is Self Assessment Tax Return In The UK

What Is Self Assessment Tax Return In The UK - Northwood Accountancy

What Is Self Assessment Tax Return In The UK

The HMRC uses self assessment to calculate tax on income. In most instances, tax is automatically deducted from salary, pension and savings. However, if you have another source of income, you need to declare it and send this return once a year. If you are wondering what is self assessment tax return in the UK, then this is what you need to know.

If you are self employed, then you need to file this report once a year, so as to pay national insurance and income levy on your profits. Other people who need to fill in this report includes:

  • If you claim a child benefit or if your spouse makes more than 50,000 pounds.
  • If you are a minister of a religion
  • If you earn 100,000 pounds or more per year as salary or pensioner.
  • If you made more than 10,000 pounds a year from savings interest or investment.
  • If you are a director or partner in a limited company.
  • If you receive taxable income from abroad
  • If you made capital gains as a result of selling an asset

This report can be filed online or you can fill in paper forms. To submit your report online, you will first need to register online with HMRC. Details you will need to fill in include your income, benefits, pension, pension contributions, charitable donations, student loan repayments, marriage allowance, blind person’s allowance and child benefits.

You need to file the report by the deadline, failure to which you will be subjected to penalties. You’ll be charged 100 pounds if you are up to 3 months late and more, if you file your report later than this.

You are not supposed to wait for the HMRC to contact you before you file a report. You are supposed to take the initiative and file a report, as long as you know that you owe levy.