What is Self Assessment?
Self Assessment is the system used by HMRC for individuals who need to report certain income and tax information that may not already be dealt with automatically.
The tax return brings together relevant income, expenses and other information so the correct tax position can be calculated.
Good to know
Keeping your income and expense records organised throughout the year can make preparing your Self Assessment considerably easier.
Do you need to file a Self Assessment tax return?
Whether you need to complete a Self Assessment return depends on your individual circumstances and sources of income.
People with income outside normal PAYE employment are among those who may need to consider Self Assessment.
- ✓Sole traders and self-employed individuals
- ✓Landlords receiving rental income
- ✓Individuals receiving certain investment or dividend income
- ✓People with capital gains that need reporting
- ✓Individuals with other taxable income requiring declaration
What records should you keep?
Reliable records are essential when preparing an accurate tax return.
Keeping documentation organised throughout the year makes it much easier to identify relevant income and expenses when it is time to prepare the return.
- ✓Income records
- ✓Business expense receipts
- ✓Property income and expenses
- ✓Investment information
- ✓Relevant tax documents
Understand your filing and payment deadlines
Self Assessment includes filing and payment deadlines that taxpayers need to monitor carefully.
Preparing early provides more time to resolve missing information and understand any tax liability before payment becomes due.
Understanding allowable expenses
Depending on your circumstances, some costs incurred wholly and exclusively for your business or other taxable activity may be relevant when calculating taxable profit.
The rules differ depending on the type of income and expense, which is why accurate records and appropriate tax treatment matter.
How an accountant can help with Self Assessment
An accountant can review your information, identify relevant reporting requirements and prepare your return using the records you provide.
Professional support can also help reduce errors and give you greater clarity about your tax position.
