Self Assessment Tax Returns for the Self Employed

Our guide covers the basics about Self Assessment tax returns, including the registration process, deadlines and late penalties.

By Chris Andreou
|
Last updated
May 29, 2024
Self Assessment Tax Returns for the Self EmployedSelf Assessment Tax Returns for the Self Employed

What is a Self Assessment Tax Returns?

If you're self-employed-either as a business owner or freelancer-you will need to complete a Self Assessment tax return.

It's one of the most important tax documents you will need to handle, and there are numerous details you'll have to keep in mind, including deadlines and late penalties.

Our guide offers a quick overview of the essentials-so it's just the article you need if you're getting started.

A Self Assessment (or Self Assessment tax return) is a form that business owners are required to submit to HMRC every year. It details how much you've earned and your sources of income, which enables HMRC to work out the Income Tax and National Insurance you need to pay.

This applies to self-employed workers, who-unlike employees-don't have their income tax automatically deducted from their salaries.

If you're self-employed—either as a business owner or freelancer—you will need to complete a Self Assessment tax return. 

It's one of the most important tax documents you will need to handle, as there are numerous details you'll have to keep in mind, including deadlines and late penalties. 

Our guide offers a quick overview of the essentials—so it's just the article you need if you're getting started.  

A Self Assessment (or Self Assessment tax return) is a form that business owners are required to submit to HMRC every year. It details how much you've earned and your sources of income, which enables HMRC to work out the Income Tax and National Insurance you need to pay. 

This applies to self-employed workers, who—unlike employees—don't have their income tax automatically deducted from their salaries. 

Who Needs to File a Self Assessment?

Individuals need to file a Self Assessment if they've received income that isn't taxed at source.

This is generally the case if you are:

  • A sole trader. You'll need to complete a Self Assessment, as National Insurance contributions or Income Tax deductions haven't been made on the income you receive from running your business. 
  • A limited company director: Limited company directors are required to file a Self Assessment, as they receive additional income not taxed at source—such as dividends. 
  • An LLP member: LLP members are required to submit a Self Assessment, as each member pays taxes on his or her share of the profits. 
  • Trustee of a registered pension scheme or other trust
  • Minister of religion
  • Employee or pensioner who has earned £100,000 or more last tax year
  • Individual who has earned £10,000 or more from savings interest, or investment income
  • Individual who has earned £2,500 or more in untaxed income such as tips or commission
  • Individual who receives taxable income from abroad, or lives abroad but receives an income in the UK
  • Individual who receives state pension payments that exceeds personal allowance
  • Individual who owes capital gains tax from selling assets such as shares or a second home at a profit
  • Individual who claims child benefit with his own income or partner's income is more than £50,000
  • Individual who received a P800 form from HMRC saying you didn't pay enough tax last year, and yet not paid the outstanding amount.

Tip: Use the Gov.uk online tool to find out if you're required to submit a Self Assessment.  

iPad showing how to register for self assessment tax return screen

How to Register for Your Self Employed Self Assessment

You can register for Self Assessment on the Gov.uk registration page.

HMRC will then send out a letter with your 10-digit Unique Taxpayer Reference (UTR), as well as set up your account for the Self Assessment online service.

If you've submitted a paper return or registered by phone previously, you would have already had a UTR number. In this case, you'll only need to create an account for the online service. 

The registration process differs slightly if you're setting up as a limited company or limited liability partnership. You'll need to access a different registration page.

When to Register for Your Self Assessment

You will need to register by 5th October after the end of the relevant tax year.

Here's an example: for the tax year starting 6th April 2023 to 5th April 2024, the registration deadline will fall on 5th October 2024. 

Self Assessment Tax Returns Deadline

First time self assessment tax returns registration and return - 5th October

Paper Return Submission - 31 October 2024

Online Self assessment submission - 31 January 2025

Self assessment tax bill payment - 31 January 2025

Advance payments (payments on account) - 31 July 2025

Online returns must be filed by 31st January, while paper returns are due earlier and must be filed by 31st October.

Whichever way you choose to file your return, payments for your tax bill are due on 31st January after the end of the relevant tax year. For example, your tax bill for the 2022/23 financial year must be paid up by 31st January 2024. 

Whenever possible, we recommend filing your Self Assessment early.

There are many benefits to doing so: this leaves you with ample time to budget for any tax you owe, and helps you avoid HMRC's late penalties. Plus, the HMRC call centres get particularly busy during January, so you may have to put up with extended wait times if you require help with your filing. 

If you're a sole trader, you can file your Self Assessment as soon as the tax year ends. If you're running a limited company, you'll need to issue yourself the P60, or have your accountant prepare this for you before you file your Self Assessment.

Making Tax Digital for Income Tax

Making Tax Digital (MTD) for Income Tax will be officially rolled out in April 2023 for self-employed individuals and landlords with an annual income exceeding £10,000.

For the time being, you have the option of signing up for a live pilot. Instead of filing a Self Assessment tax return, you'll keep digital records and provide updates to HMRC to test and develop the MTD for Income Tax service.

Self Assessment Late Filing & Payment Deadlines

HMRC's Penalties for Late Filing:

  • You will be charged a penalty of £100 if you fail to file on time 
  • A daily penalty of £10 will be charged, up to a maximum of £900 if you haven't filed by 30th April
  • A penalty of £300 (or 5% of the tax you owe, if this is greater) will be charged if you haven't filed within a year
  • An additional penalty of up to 100% of owed tax may be charged under certain circumstances, such as if HMRC determines that you've been deliberately avoiding paying tax

Penalties for Late Payments:

  • If you are 30 days late, a penalty of 5% of the tax due will be charged
  • If you are six months late, a penalty of 5% of the outstanding tax at that date will be charged
  • If you are 12 months late, a penalty of 5% of the outstanding tax at that date will be charged

How GoForma can Help?

At Goforma, we take the hassle out of self-assessment tax returns for sole traders and individuals like you. With a commitment to simplicity and efficiency, we nmanage the complexity of tax regulations, ensuring that our clients not only meet their obligations but also maximize their financial efficiency. Our dedicated team of experts at Goforma is well-versed in the nuances of self-assessment, providing personalized assistance tailored to the unique needs of each client. Choose Goforma for a seamless self-assessment tax return service, where expertise meets personalized service for your financial success.

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