The self-assessment deadline is nearly upon us, and many freelancers and independent contractors across the UK will be knee-high in receipts and paperwork this weekend, having left it all until the last minute (the taxman typically receives over half a million self-assessment forms on deadline day each year).
Granted, it might have been better to get it done during the Christmas break, but that’s life – only the truly eccentric would choose accountancy over a drunken snooze through the Queen’s speech.
Our customers at My Accountant Friend have had it easy, of course. We are a little bit eccentric ourselves, so we’ve been happily ploughing through self-assessment forms for some time now, getting our people ship-shape in time for January 31st. However, if you’re still wondering what lies ahead of you, here’s a round-up – all you need to know about filing your tax return online, your eligibility for self-assessment, the reasons you might be excused and the penalties you could incur.
And remember, if you’re feeling stuck, drop us a line at My Accountant Friend and we’ll talk you through how we might be able to help.
Who needs to file a self-assessment tax return?
It might be easier to re-phrase that question. If you’re asking ‘who doesn’t need to file a self assessment form’, then the answer is simple: almost anyone who receives a salary or a pension. HMRC has a relatively easy form that’ll help you find out your own answer, but strictly speaking, if you’re self-employed in any way (and that even includes religious ministers) or earning on top of your PAYE salary, if you’re earning over £50k and claiming child benefit, if you’ve made profits that could incur capital gains tax, then you’re eligible.
Check out the list below, as published on HMRC, and give us a call if you’re still unsure.
Can I claim tax relief?
You can in certain and circumstances, and while it’s always best to talk these through with your accountant, roughly speaking you can claim relief on donations to charity, work expenses over £2,500, and certain forms of private pension. We’re only a phone call away if you want to chat.
What excuses will HMRC accept for a late self-assessment tax return?
We certainly wouldn’t recommend suggesting that your dog ate it, if that’s what you’re asking. But it is a bit like being back at school, trying to avoid doing your homework.
Excuses that may wash include the death of a partner or close relative in the days leading up to the deadline, a severe illness that required a lengthy hospital stay, a tech failure that prevented you from filing on time, problems with HMRC’s online filing system, an emergency at home (basically fire, flood or theft), or delays caused by the postal service that you couldn’t have anticipated. For all of these points, of course, you’re going to need proof, so don’t use them unless you can back your claims up.
Excuses that absolutely won’t wash include ‘I asked someone else to do it for me and they let me down’, the payment didn’t go through because you didn’t have enough money in the account, the online system was too difficult to use, or HMRC failed to remind you.
See? We told you it was a bit like being back at school. Replace HMRC with Mr Higgins, and you’re pretty much there.
Where can I file my self-assessment tax return online, and when are the deadlines?
The deadline for your self-assessment tax return is 11:59pm on January 31st. This isn’t just the paperwork – HMRC expects payment by then, too. Any late payment will accrue interest, so don’t make that rather costly mistake.
Again, it’s worth stressing that an accountant such as My Accountant Friend can help you with this. However, if you’re attempting it yourself, you need to file the form by logging into your HMRC account.
What are the penalties if I miss my self-assessment deadline?
The first penalty is a fine – £100, to be precise. Following on from that, things get progressively more sticky. HMRC are within their rights to collect the money that you owe via a debt-collection agency, by taking your possessions and selling them to raise the cash, by taking legal action, or by making you bankrupt and closing down your business. All in all, it isn’t a lot of fun. We don’t recommend testing them.
What happens if I get my self-assessment in on time?
Not a whole lot, but you have our permission to feel pretty pleased with yourself.