Every year, most taxpayers in the UK have their taxes done by their employers, but if you are self-employed, you are likely to have to submit a self-assessment tax return. But who else needs to submit one?
A self-employed sole trader must submit a self-assessment if earnings are above £1,000, before any tax reliefs, or they are a partner in a business partnership. You also need to submit a tax return if you claim income tax-reliefs, or to prove you are self-employed to claim tax-free childcare or maternity allowance.
There is also a group of employed workers who have to submit a tax return and where just paying tax through Pay As You Earn (PAYE) is not enough. This is generally when people who are employed receive some extra income, such as from property rentals, having investments income, receiving foreign income, doing casual freelance earnings or other untaxed income.
Often high earners over £100,000 on PAYE must file a self-assessment tax return with HMRC as they are likely to be on a more complex financial position than most (different income sources) and it can affect your tax-free Personal Allowance; Losing £1 of your tax-free Personal Allowance for every £2 of income over £100,000.
The most important thing to do if you think you might need to complete a self-assessment is find out sooner rather than later. You don’t want to be in a position where you are rushing at the last minute and if you do think you want or need help to complete it its harder to find someone great the closer you leave it to the end of January deadline for submission. AIMS are able to help you with your tax returns so you can avoid any tax return penalties.
AIMS accountants are available to assist in the submission of self-assessments to individuals who qualify. If you are not sure if you must submit, get in touch with your local accountant to provide further guidance.