Self Assessment tax returns – do they apply to you?

It’s not only the self-employed that may qualify for submitting a Self Assessment tax return, read on to find out more, and avoid getting penalised

The end of summer represents many things, fading suntans, shortening days, shifting hair trends, and changing colour and style requests from clients. But for the self-employed especially, there’s something else too, and its tax related…got your attention yet?

The final part of the year is upon us, and UK-based self-employed stylists earning over a certain amount, (trust us – you probably are), must submit a Self Assessment tax return for the 2022 to 2023 tax year – which runs from 6 April 2022 to 5 April 2023.

Why you might need to submit

There are many reasons why you might need to submit for the first time. Let’s start with the obvious, such as when you start working for yourself and earning over £1,000. Having multiple sources of income, receiving untaxed income, (think getting paid for an extra service like creating online content), and receiving income from a property you own or rent out are other things that make you liable for Self Assessment.

There are other, more complex reasons why you might need to submit for the first time, understand what these are to avoid getting in trouble with the tax man! Even if you are paying taxes through PAYE in an employed role, you may still need to submit a tax return. This could be down to becoming a new partner in a business partnership, such as a hair salon, claiming child benefit when you or your partner earn more than £50,000 per year, if you earn more than £100,000 a year, or if you receive dividends more than £10,000.

Do you receive interest from banks and building societies in excess of £10,000 or pay Capital Gains Tax? Then you’ll need to submit too. Another reason is if you are self-employed, and earning less than £1,000, but still want to pay Class 2 National Insurance Contributions (NICs) voluntarily to protect your entitlement to a State Pension and certain benefits.

To submit or not submit!?

If this is your first year submitting a Self Assessment, you only have until 5 October 2023 to tell HMRC. If you are still unsure whether you need to complete a tax return for the 6 April 2022 to 5 April 2023 tax year, there’s a free online tool to use on GOV.UK to find out.

If you are liable, there’s a step-by-step guide to filing for the first time. If you’re already registered, just use your existing Unique Taxpayer Reference (UTR) to complete your tax return, this can be found on letters from HMRC and on the HMRC app. To register for the first time, visit the government website here.

Some people have been submitting a Self Assessment tax returns for years, but now don’t need to. These are the reasons why; if someone is no longer working or retired, no longer self-employed, or earning below the minimum income thresholds. If you fall into this category, let HMRC know before 31 January, which is the self-assessment deadline, or you could face a penalty. Visit GOV.UK to request to remove yourself from Self Assessment.

Submitting 101

If you have to submit a Self Assessment tax return, try to submit as early as possible. While many cut it close and submit by the deadline of 31 January each year, you can file any time after 6 April. The upside of this is you find out what you owe earlier, giving you time to get organised.

Finally – be aware of scammers, who are aware of the Self Assessment dates and will encourage you to click on links that aren’t from HMRC. The best way to stay secure is to safely guard your HMRC login details. Don’t share them with anyone if you can avoid it. Again, the GOV.UK site has great advice to help protect yourself against scams.

So, that is everything you need to know about Self Assessment tax returns; if you need to do it or not, when to do it, how to do it, and what to watch out for. What are you waiting for? Get the tax-thang out the way, and you can get on with what you do best, running your business.

To check if you need to submit a Self Assessment tax return, visit the government website 

To read more stories, click here >