Unique Taxpayer Reference Number (UTR Number)
The Unique Taxpayer Reference (UTR) number plays a crucial role in various aspects of taxation, including filing tax returns, registering for self-employment, claiming tax refunds, and corresponding with tax authorities. Understanding the purpose and significance of the UTR number is essential for individuals and businesses to fulfill their tax obligations effectively. In this guide, we will delve into the understanding of UTR numbers, their purpose, how to get unique taxpayer reference number, and their importance in managing your tax affairs.
What is Unique Taxpayer Reference Number?
A unique taxpayer reference (or UTR) number is a ten-digit code that's unique to you or your company.
Every individual and business entity in the UK that is required to file a tax return or has tax obligations is issued a UTR. This includes self-employed individuals, companies, partnerships, and other types of organizations. Your UTR number will remain the same throughout your entire life, just like your National Insurance Number.
The UTR is used to identify taxpayers and ensure accurate record-keeping for tax-related matters. It is typically provided on tax-related documents, such as self-assessment tax returns, correspondence with HMRC, and other tax-related forms.
It provides them with an easy way to match records to payments and monitor for suspicious activity. You'll need your UTR number to complete self-assessment tax returns, work with accountants, and pre-pay taxes in instalments.
Structure of a UTR Number
The structure of a Unique Taxpayer Reference (UTR) number consists of 10 digits. Here is a breakdown of the typical format:
- First two digits: Tax office identifier - The first two digits of the UTR number represent the tax office that issued the number. This identifies the specific HM Revenue and Customs (HMRC) office responsible for your tax affairs.
- Next six digits: Unique reference - The next six digits form a unique reference number. This number is specific to the individual or entity to whom the UTR is issued. It helps differentiate between different taxpayers within the same tax office.
- Final two digits: Checksum - The last two digits of the UTR form a checksum. This is a validation mechanism used to ensure the accuracy of the UTR number. It helps detect any errors or discrepancies that may have occurred during the entry or processing of the UTR.
Overall, the UTR number is a 10-digit identifier that combines the tax office identifier, unique reference, and checksum to provide a unique and verifiable number for each taxpayer.
Who Needs a UTR Number?
A Unique Taxpayer Reference (UTR) is required for individuals and entities in the United Kingdom who have tax obligations or need to interact with HMRC for tax-related matters. Here are some examples of who typically needs a UTR number:
- Self-employed individuals: If you work for yourself and earn income that needs to be reported for tax purposes, such as freelancers, contractors, consultants, or sole traders, you will need a UTR.
- Limited companies: Any company incorporated in the UK, including private limited companies, public limited companies, and foreign companies with a UK branch, requires a UTR.
- Partnerships: Partnerships, which are business entities formed by two or more individuals or companies, need a UTR. Each partner within the partnership will also have an individual UTR.
- Trusts and estates: Trusts and estates that generate income or have tax obligations must obtain a UTR. This applies to both discretionary and non-discretionary trusts, as well as estates of deceased individuals.
- Non-profit organizations: Charities and other non-profit organizations that have tax obligations, such as filing annual tax returns, need a UTR.
Company vs Personal UTR numbers
Personal UTRs are automatically issued by HMRC to anybody who registers for self-assessment. These numbers cannot be utilized as your company UTR. Instead, you'll be assigned a separate UTR for your company after it's incorporated.
You don't need to do any work to make this happen. Companies House will notify HMRC at the appropriate time and, within days following company formation, you should receive a letter from HMRC that includes your company's UTR.
The letter will be addressed to your registered office address and will not be sent to your own personal address.
Why do I need a UTR Number?
You might not actually need one at all.
The only people who need UTR numbers are those who file Self-Assessment tax returns - that means that they've either set up a limited company or they're self-employed.
If you do file self-assessment tax returns, you need a UTR number so that:
1. HMRC can monitor your tax obligations
HMRC will use this reference to track your tax obligations, which could help you also get a tax refund if you've overpaid your tax.
2. You can file tax returns
You'll need it for your self assessment tax return if you're self employed, and your company UTR is used to calculate your company tax.
3. You can partner with accountants
Accountants and financial professionals will need to know your UTR to help with your filings and financial affairs.
How to find my UTR number?
You can find your UTR number in a variety of ways, provided you've already got one.
It should be easy to identify thanks to its length; your UTR can be easily located on numerous documents from HMRC, including:
1. Previous tax returns
2. Payment reminders
3. Notices to file tax returns
4. Statements of account
5. The "Welcome to self-assessment" letter (SA250)
Your UTR number can also be found online in your Government Gateway account. It's located in the top right-hand corner of your account summary.
How Do I Get a Unique Taxpayer Reference UTR?
When you launch a limited company or get set up for self-assessment tax returns, you automatically undergo the UTR registration process.
You'll automatically receive a UTR number after the process is complete. Keep in mind that it can take some time to receive your number - it's best to apply a few months in advance of when you'll need your UTR number to ensure things go smoothly.
In order to register for unique taxpayer reference, you'll need to provide:
- Your full name
- Your current address
- Your National Insurance Number
- Your date of birth
- Your phone number
- Your email address
- The date that your self-employment began
- The type of business you're starting
- The address of your business
- The phone number for your business
It's easy to apply for your Free UTR number and - provided you've got all of the necessary information on hand - easy. You can notify HMRC online or print and fill out a form before posting it to them.
Protecting Your UTR Number
- Keep your UTR confidential: Your Unique Taxpayer Reference (UTR) is a sensitive and personal identifier that should be treated with utmost confidentiality. Here are some key points to consider:
- Do not share your UTR number with unauthorized individuals or parties.
- Avoid including your Unique taxpayer reference number in public documents, emails, or online platforms.
- Only provide your UTR when required by trusted entities, such as HMRC and authorized tax advisors.
- Be cautious about sharing your UTR over the phone, ensuring you are speaking with a legitimate representative from HMRC or a trusted organization.
- Secure storage of tax-related documents: In addition to protecting your UTR, it is essential to ensure the secure storage of your tax-related documents. Here are some tips to safeguard your tax records:
- Keep physical copies of documents in a secure location, such as a locked cabinet or safe.
- Store electronic copies of documents in encrypted and password-protected folders or cloud storage services.
- Regularly back up your electronic files to prevent data loss.
- Dispose of tax documents properly by shredding physical copies and securely deleting electronic files that are no longer needed.
- Being cautious of phishing attempts: Phishing is a fraudulent technique used by cybercriminals to obtain sensitive information, such as UTRs, passwords, or financial details. To protect yourself from phishing attempts:
- Be skeptical of unsolicited emails, text messages, or phone calls asking for your UTR or other personal information.
- Verify the legitimacy of the communication by independently contacting the purported sender through official channels (e.g., HMRC's official website or contact information).
- Do not click on suspicious links or download attachments from unknown sources.
- Keep your computer and other devices protected with up-to-date security software and firewalls.
By following these measures to keep your UTR confidential, securely storing your tax-related documents, and being cautious of phishing attempts, you can minimize the risk of unauthorized access to your tax information and protect yourself against potential fraud or identity theft.
How can I find a lost UTR number?
Those who've lost their UTR numbers should act quickly to rectify the situation. You can find steps on how to find lost UTR numbers here.
When it comes to taxes and the government, it's always best to have your ducks in a row before deadlines start approaching. Try to have your National Insurance number at the ready and then ring HMRC's self-assessment helpline at 0300 200 3310.
For any general enquiries, you can reach out to HMRC Helpline numbers during their working days.
Telephone: 0300 200 3310
Outside UK: +44 161 931 9070
8am to 8pm, Monday to Friday
8am to 4pm Saturday
9am to 5pm Sunday
Does my UTR number change if I acquire a company?
If you purchase a company and continue to trade under the same company number then the UTR doesn't change.
If the assets and liabilities of the company are being transferred to the acquiring company (effectively meaning it's no longer trading as the same entity), then the acquiring company's UTR number will apply.
How to Apply for a UTR Number
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Frequently Asked Questions:
- How do I reactivate my UTR number?
Your UTR number will become inactive if you haven't used it for an extended period of time, such as when you've stopped submitting a Self Assessment tax return. Your UTR number will be reactivated once you begin submitting your tax return.
- How do UTR numbers work for partnerships and limited companies?
The partnership will be issued a UTR number. Each individual partner will also be assigned a UTR number. Similarly, each limited company director, along with the company will be issued a UTR number.
- Do I need a UTR number to submit my return?
Yes, you need a Unique taxpayer reference number to complete your self-assessment tax return successfully. If you’re self employed, or you own a limited company, you need a UTR number.
- How long does it take to get a UTR number?
After registering for self-assessment, you should receive your UTR number in 10 working days or 21 working days if you're abroad.
- Do I have to pay to apply for a UTR number?
No, you don't have to pay anything. It's completely free to get a UTR number.
- Can I have more than one UTR?
Typically, individuals and entities are assigned only one Unique Taxpayer Reference (UTR) number. The UTR is intended to be a unique identifier for each taxpayer, helping HMRC track and manage their tax-related activities effectively.
- Can I change my UTR?
It is not possible to change your Unique Taxpayer Reference (UTR) number once it has been assigned by HMRC. The UTR is intended to be a unique identifier that remains consistent throughout your tax-related activities.
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