For Immediate Release
Self Assessment for Beginners
Tax Preparation Specialist Issues Guidance to Taxpayers New to Self Assessment Tax Returns
With the latest figures showing there are a record 4.93 million self-employed taxpayers in the UK, more taxpayers are finding themselves within the remit of Self Assessment. A lack of taxation knowledge and experience has resulted in a surge in late tax returns and payments as those who are newly self-employed struggle to make sense of their requirements under Self Assessment. Tax preparation specialist David Redfern, director ofDSR Tax Claims Ltd, has issued his guide to the basics of Self Assessment with tips for those new to this method of paying Income Tax.
Workers who are self-employed as a sole trader and have an income of more than £1,000 are expected to register forSelf Assessmentand complete a tax return even if they will not have tax to pay. However, other taxpayers will also be required to register for Self Assessment. Redfern stated "Self-employed sole traders who fail to register for Self Assessment on time can receive a penalty from HMRC but there are other sectors of taxpayer who may not realise they have to complete a tax return. If you receive any untaxed income, whether from rental property or savings, you need to report that to HMRC and there may be tax to pay in that income. If you are a high earner, with an adjusted income of over £50,000 you will need to register for Self Assessment if you wish to receive child benefit. Additionally, if you wish to claim tax relief on any expenses you have picked up through your employment and they total more than £2,500, you can only claim those by completing a Self Assessment tax return".
If you are subject to Self Assessment, there are a number ofimportantdates to keep in mind to avoid HMRC penalties for missed Self Assessment deadlines. Redfern explained "If you have self-employment income for the 2017/18 tax year and you aren't already registered for Self Assessment you need to register by 5thOctober 2019, just over two weeks away, or you face a penalty based on how much tax HMRC estimates you owe. Once registered, you will receive your UTR (unique taxpayer reference) from HMRC and you cannot complete a tax return without that UTR - and bearing in mind that it can sometimes take a while for that to arrive in the post, you could find yourself missing further deadlines such as the deadline to submit a paper tax return on 31stOctober. Depending on the backlog of UTRs at HMRC, you could potentially find the online tax return filing deadline of 31stJanuary difficult". The 31stJanuary deadline for submitting an online tax return and paying any tax owed is well-known due to HMRC's media campaigning but there are lesser known deadlines which those new toSelf Assessmentmay be unaware of. If a taxpayer wants any tax owing to be taken out of their wages or pension, they must have submitted their online tax return by 30thDecember. And not only does any tax owed need to be paid by 31stJanuary, many self-employed taxpayers will also need to pay a "payment on account" for tax likely to be owed in the current tax year. The first payment on account is also due on 31stJanuary with a second payment due on 31stJuly.
HMRC issues a range of penalties for late filing of Self Assessment tax returns and late payment of tax due, with those only one day late in submission receiving a penalty of £100. Penalties increase if the tax return is submitted more than 3 months late and again if more than 6 months late. In addition, a penalty and interest will be levied on the late payment of any tax bill. Redfern stated "With HMRC resorting to increasingly aggressive methods when chasing down tax debts, it is so important to keep on top of those deadlines even though many self-employed business people would prefer HMRC'spayment timetables to reflect the more flexible nature of modern business. When adding interest and penalty payments, debts can soon mount".
Where a taxpayer believes they need to make changes to their tax return, HMRC allows changes to be made for up to a year after the submission deadline. However, the changes may alter the taxpayer's tax bill and could result in additional tax plus interest being owed.
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About DSR Tax Claims Ltd
DSR Tax Claims Ltd (company registration 11459292) are a firm of tax rebate specialists serving clients nationwide. DSR Tax Claims are tax preparation experts who specialise in identifying potential allowable expenses for tax rebates for clients. Their specialist team can help employed and self-employed subcontractors with all relevant paperwork to ensure their claim is handled in an accurate and efficient manner.
For more about DSR Tax Claims, visithttps://dsrtaxclaims.co.uk/
For media enquiries, please emailpressoffice@dsrtaxclaims.co.ukor call 0115 795 0232
DSR Tax Claims Ltd
Company Registration: 11459292
Registered Office: Ground Floor, Seven Mile House, 1 Mansfield Road, Papplewick, Nottingham, NG15 8FJ