Filing a Self Assessment tax return can seem like a huge challenge. But don't stress, if you get yourself ready, stay organised, and understand what they're asking you to do, it's super easy. Just make sure you get it right, so you don't have to pay any extra fees - and be on time as the online filing deadline is January 31st 2023 (or was by October 31st, 2022 if you did it on paper) - so just under two weeks to go for the final chance.
Use the below calculator to estimate what your tax bill could be - it's set up for multiple sources of income, just like you input in your Tax Return, but will estimate the tax owed for earnings between April 2021 and April 2022 instantly.
Not everyone is required to fill out a Tax Return. It all depends on how much money you made and where it came from. If you didn't make more than £50,000, rent property or earn untaxed income, you're probably in the clear.
If you've got income over £1,000 from self-employment, more than £2,500 from renting out property, over £2,500 in untaxed income like tips, made more than £10,000 from savings or investments, need to pay Capital Gains Tax, are a director (not of a charity), earn over £50,000 and claim Child Benefit, have income from abroad, earned over £100,000 in the 2021/22 tax year .... the list goes on but if these apply, you will need to file the self assessment.
If you're still not sure, you can always contact HMRC for more help.
If you've never done a tax return before, you'll need to sign up for Self Assessment (if you submit your taxes for the 2021/22 tax year, you'll have to register for Self Assessment by October 5th, 2022). Depending on your situation, there's different ways to register. You'll get a Unique Taxpayer Reference (UTR) and then you'll have to make a Government Gateway account. You'll get an activation code in the post, then you have to finish setting up the Gateway account. If you've done tax returns before, you'll need your old UTR to register and get the account going. It's best to test it out before you do your Self Assessment, that way you won't get stuck if you can't log in.
Filling out a tax return might sound like a daunting task, but don't worry - it's not as hard as it looks! To make sure you've got everything you need, make sure you have your UTR, NI number, records of any untaxed income, expenses, donations and P60s. Don't forget to read the HMRC help sheets for extra info, and if you're completing your return online, there's help available in the online form.
Okay, so here's the deal on filling it out. The main section, that's the SA100, covers all your taxed and untaxed income (dividends, interest, pensions, charitable donations, benefits, etc.). If you're a company director, a foreign national, self-employed, own property, have capital gains, or get money from abroad, you gotta fill out the Self Assessment Tax Return supplementary section!.
Main SA100 - Income
Got interest from bank and building society accounts? Got dividends from shares fill that in here.
Main SA100 - Pensions, Annuities and Benefits
If you're retired, you need to add up how much State Pension you got over the tax year, any State Pension lump sum, and any other annuity or pension lump sum. If you're getting benefits, you'll have to include the amount of Incapacity Benefit and Jobseeker's Allowance you got, plus any other taxable benefits like Bereavement Allowance, Carer's Allowance, and Industrial Death Benefit. But don't worry about Attendance Allowance, Bereavement Support Payment, Personal Independence Payment, Pension Credit, Working Tax Credit, Child Tax Credit, Employment Support Allowance, Maternity Allowance, or War Widow's Pension - these ones are taxable so don't count!
Main SA100 - Other Income
Got any income that doesn't come from interest, dividends, or the extra pages? Put it here! Don't forget to also include expenses and taxes you've already paid. You know, so you don't have to pay them again.
Main SA100 - Pension Contributions
If you've made payments into a private pension scheme, annuity, or your employer's scheme that were made post-tax, so after paying taxes, you're essentially giving away your hard-earned cash - so put details of those schemes here to get the tax relief!
Main SA100 - Charitable Donations
Tally up all the donations you made to charity during the tax year! Throw in any shares, securities, land, and buildings you gifted, too!
Main SA100 - Blind People and Student Loans
Are you claiming Blind Person's Allowance? How about that Student Loan? Are you still paying it off? And what about those deductions your boss is taking out? These goes in these relevant sections.
Main SA100 - Child Benefit
The high-income benefit charge effectively reclaims some or all of the Child Benefit paid to your family is you or your partner earned more than £50,000. You let the Taxman know via this section.
Main SA100 - Marriage Allowance
If your income was lower than the Personal Allowance and you want to give some of it to your partner, fill out this section! Let them get their hands on those sweet, sweet tax benefits!
So that's the main section covered, but what about the supplementary page?... If you've got income from self-employment, property, or capital gains, you'll need to fill out some extra pages in your Self Assessment tax return. For self-employment, it's page SA103. For property income, page SA105. And for capital gains, page SA108. But don't worry - report all your income, and you can deduct any allowable expenses to reduce your tax bill.
Self employment
You'll need to add up all your earnings from the past tax year and put it in the "business income" section. This means you gotta add up all that cash you made before you deduct all the expenses. If you got more than one source of income from self-employment, you can enter them separately. Just make sure you tell the taxman which one you make the most money from.
Self-employed income support grant
If you got a SEISS grant, you need to add it to your tax return! The first 3 grants should be included on your 2020/21 return and must be submitted by January 31st 2022. The last 2 grants should go on your 2021/22 return and must be submitted by January 31st 2023. Don't forget - SEISS grants should be added under the 'Other tax adjustments for your business trading name' section - not as income!
Expenses
If your annual earnings are under £85,000, you can just give your total expenses. But if you make more than that, you'll have to list each expense individually and add up to a grand total. If you take the £1,000 tax-free trading allowance, though, you're not allowed to claim your expenses. What kind of expenses can you include? Stock, equipment, wages, payments to subcontractors, travel, rent, power and insurance, repairs, maintenance, office costs, advertising and business entertainment, loan interest, bank charges and professional fees. No need to keep those receipts around – just remember to keep the records of your expenses for five years if the HMRC asks for them.
Property Income
You'll need to add up the moolah you've made from all of your UK furnished holiday lettings and enter it on one page. The only snag? If you've got any EEA (European Economic Area) lettings, you'll need to jot down that number on another page. Finally, you'll have to total up all the rent you've made from other properties to complete the second section. Not too bad, right?
Property Expenses
You can claim expenses for things like rates, insurance, ground rent, property repairs and maintenance, loan interest, and more. Plus, you can get up to £7,500 a year tax-free with the Rent a Room scheme - what a sweet deal! Just keep in mind that if you claim the £1,000 tax-free trading allowance, you won't be able to claim any expenses.
Capital Gains
Income from capital gains is referred to as 'disposal proceeds'. You’ve gotta list a different ‘disposal proceed’ amount for: homes, other properties, stocks and bonds.
Capital Gains Expenses
When it comes to taxes, you can claim for 'allowable costs' - like the money you paid for the asset, and any updates you made (that still exist when you sell it!). For example, you can't claim for a new fittings if you took them out before you sold the property. Make sure you keep track of your records, otherwise you could end up claiming the same thing twice - like when you claimed for something on a buy-to-let property in a previous year and then tried to claim again when you sold it. That would be a major flag. So keep your eyes peeled and your receipts in check!
Once all done and you get your calculation... and your tax bill!, You can break up your tax bill into smaller chunks. But, don't worry, it's not like it's a loan or anything - it's just an advance on your next bill. This is the payment on account system. To help manage this payment you can set up a budget payment plan through your online tax account, so you decide how much you want to pay each week or month. Plus, you can even take a break for up to six months if you need to. Just make sure you've already paid your last Self Assessment bill or you may have issues setting this up.
