Editor’s note: This post was originally published on 17 December 2014. It has now been completely revamped and updated for accuracy and comprehensiveness.
You must fill out a self-assessment tax return if you are a company director or work alone as a sole-trader, are a self-employed businessperson, or have a pre-investment income of more than £10,000. You will need to fill a form even if you meet your tax obligations through PAYE but have self-employed income too. There are many other circumstances where you may have to fill out a return - we have listed them below.
As a general rule, HMRC will send you a self-assessment tax return or a notice which legally obligates you to complete a tax return. But the onus is on you to inform HMRC if you think you need to complete a tax return.
You must file a self-assessment tax return if in the last tax year (2014-15):
- You were self-employed or work alone as a sole trader
- You were a partner in a business partnership
- You were a company director (unless it’s for a non-profit organisation, eg a charity, and you don’t get any pay or benefits, like travel expenses or a company car)
- You have a pre-tax investment income of £10,000 or more
- You were an employee or pensioner with an income of £100,000 or more
- You were a minister of religion
- You were a trustee or representative of someone who has died
- You have untaxed income – from investment, land or property, or from overseas
- You have made capital gains above the annual exempt amount (£11,000 for 2014-15)
- You are a pensioner over 65 who gets reduced age-related allowance
- You are not domiciled in the UK or live and work abroad
- You have sold or given an asset away (such as a holiday home or some shares)
- Your household receives child benefit and a member of the household earns over £50,000 per annum.
If you still aren’t sure if you need to file a self-assessment tax return you can use HRMC’s free tool to find out. Once you are sure, you’ll need to register for self-assessment before you can send HMRC a tax return.
Missing the tax return deadline results in an immediate penalty of £100. As the deadline for paper tax returns (31 October 15) has already passed, you'll need to file a tax return online by midnight, Friday, January 31, 2016.
If in doubt, speak to a specialist
If your tax affairs are complex it will be well worth your money to hire a tax professional to complete your self-assessment tax return rather than risking it yourself. As part of their service they will register, compile and file your self-assessment tax return.