For a tax return there are two separate deadlines – one for the paper return and the other for electronic filing. For paper filing for the tax year ended 5 April 2013, known as tax year 2012-13, the deadline is at the end of next month, 31 October. And if you miss the 31 October paper filing deadline, then you can only file electronically on 31 January 2014. If you have relatively straightforward tax affairs and already pay tax through PAYE (Pay As You Earn) you probably won’t need to complete a tax return. But if you have income from self-employment or above a certain level you may need to complete one.
What are the most common reasons for needing to fill in a tax return?
1. You're self-employed
You have to complete a return for each year you were self-employed (or a partner in a partnership). You need to complete a tax return even if you make a loss or if it’s your final year of trading.
2. You're a company director, minister, Lloyd's name or member
You must complete a return if you’re any of the following:
- a company director (unless you're a director of a non-profit
- organisation, for example a charity, and don't receive any payments or benefits)
- a minister of religion (any faith)
- a name or member of Lloyd's
3. Your annual income is £100,000 or more
If you receive total income of £100,000 or more you’ll need to complete a tax return. You may have higher or additional rate tax to pay that hasn’t been collected through your tax code.
4. You have income from savings, investment or property
If you are an employee or a pensioner and already pay tax through a PAYE code, you can sometimes ask for tax that you owe on income, such as savings and property, to be collected through your code number. You’ll need to complete a tax return instead if the income you receive is:
- £10,000 or more from taxed savings and investments
- £2,500 or more from untaxed savings and investments
- £10,000 or more from property (before deducting allowable expenses)
- £2,500 or more from property (after deducting allowable expenses)
- Another £300 (or 5% of the tax you owe, whichever is greater) if you haven’t filed within a year
- More penalties - including up to 100% of the tax owed, if HMRC believed you are deliberately delaying
If you don’t pay tax through a PAYE code you’ll need to complete a tax return if all of the following apply:
- you have income to declare, for example income from savings, trusts or abroad, rental income from land or property
- your total income exceeds your total allowances and reliefs
- you have tax to pay on this income
5. You need to claim expenses or reliefs
If you’re employed and want to claim expenses or professional subscriptions of £2,500 or more, you’ll need to complete a tax return. If you want to claim expenses below this amount, you can contact HMRC.
You can only claim certain reliefs, such as Enterprise Investment Scheme relief or relief on Venture Capital Trusts, by completing a tax return.
6. You or your partner receive Child Benefit and your income is over £50,000
The new High Income Child Benefit tax charge, introduced on 7 January 2013, may mean you need to complete a Self Assessment tax return for the first time. You must complete a tax return if all of the following apply:
- your income is over £50,000 a year
- you live with a partner and your income is higher than theirs
- you or your partner are entitled to receive Child Benefit (or get an equivalent amount from someone who claims Child Benefit for a child who lives with you)
- you jointly decide to keep receiving Child Benefit and pay the new tax charge
What this means is you will be looking at a minimum fine of £1,600 if HMRC fails to see your tax return within a year. Penalties are not the best way to spend your hard-earned cash. We think it’s better to pour yourself a cup of coffee and get started.
7. You get income from overseas
You must complete a tax return if you have any foreign income that’s liable to UK tax.
8. You have income from trusts, settlements and estates
You must complete a return if you receive income (or are treated as receiving income) on which tax is still due, for example from:
- annual trusts or settlements
- the estate of a deceased person
9. You have Capital Gains Tax to pay
If you have Capital Gains Tax to pay, for example you’ve sold, given away or otherwise disposed of an asset such as a holiday home or shares, you’ll need to complete a tax return and the Capital Gains Tax pages.
10. You've lived or worked abroad or aren't domiciled in the UK
Residency is a complex issue. Follow the link below to find out more about your residency status, the remittance basis and what to do next.
You may need to complete a tax return if you’re:
- not resident in the UK
- not ordinarily resident in the UK
- not domiciled in the UK and claim the 'remittance basis'
- dual resident of the UK and another country
11. You're a trustee
You’ll need a tax return if you’re a:
- trustee or personal representative (including someone who manages the tax affairs of a deceased person)
- trustee of certain pension schemes
If you have tried filing your tax in the past, but now think perhaps it wasn’t the most efficient way, contact a qualified personal tax accountant for advice.
