What is a self-assessment tax return?

March 18, 2022

Introduction

People or businesses in Scotland with income that’s not automatically taxed must report it in the form of a self-assessment tax return. HMRC has an online self-assessment system to collect income tax.

If you’re unsure as to whether you need to submit a self-assessment tax return, read this blog that outlines everything you need to know about them.

What is a self-assessment tax return?

A self-assessment tax return is a legally binding document used to calculate how much tax you owe on your income. The form allows you to declare your earnings, irrespective of whether you owe tax or not. In some instances, the form can help you secure a tax rebate instead.

The tax office sends you a tax return if they think you fit the self-assessment criteria. Upon receiving the notice, you need to complete it within the deadlines provided to avoid penalties. The current deadline for an online self-assessment tax return form is 31st January.

If you receive a notice from HMRC requiring a tax return for previous tax years, you’re usually given three months to complete and submit the form from the date you receive the notice. It’s important that you allow for up to 20 working days if you’ve never filed a self-assessment tax return, as you need to go through a registration process first.

Who has to fill in a self-assessment tax return?

You need to fill in a self-assessment tax return if you work on a self-employed basis. Other instances when you may be required to fill one out include:

– To claim work expenses
– To claim Tax-Free Childcare or Maternity Allowance
– If you’re a landlord receiving income from a property
– If you’re a non-resident UK taxpayer
– If you’re a non-resident UK landlord

It’s important that you complete a self-assessment tax return if you receive any other form of untaxed income. This includes COVID-19 grant or support payments, tips and commission, income from savings, investments, and dividends, or foreign income.

How to submit a tax return

You can complete a self-assessment tax return online or in paper format. The tax office provides free software for individuals wanting to complete the form online. Please note that, in some instances, you may have to use commercial software.

A2Z Accounting provides accounting services in Aberdeen. If you need help filling in your tax return, don’t hesitate to contact our team today.