The deadline for filing your Self Assessment tax return is 31 January. This means that the filing deadline for the tax year 2021-22 is 31 January 2023. If you haven’t already you will need to file your income and expenditure from self assessment with HMRC online, plus pay any tax that you owe for this period, by midnight on 31 January 2023.
Self-Employed Tax Deadline on 31 January
Your tax return reports your income, expenses, and other financial information in three sections – income, deductions and tax credits. Usually tax returns are filed annually by individuals, whether they are a sole trader working individually, or a partnership. Partnerships also file individual self-assessment tax returns as opposed to a corporate tax return. As a self-employed individual you will need to file your self assessment tax return once a year, in the UK the tax year runs between 6 April and 5 April. Following this period you have 10 months to get your records in order and file your self assessment tax return by the 31 January the following year.
Filing for the First Time
If you work for yourself self assessment is the simplest way to pay tax. Registering with HMRC online is quick and easy. You will receive a UTR number (unique tax-payer reference) by post, within 10 days of registering. You will need this when you log in to submit your self assessment tax return. Self-employed workers are entitled to a tax free allowance. You start paying income tax on any amount you earn over this threshold. Which is why it pays to record all expenses that relate to the services you supply, to avoid overpaying tax. You can find the up to date tax thresholds on gov.uk. Allowable expenses could be tools, materials, protective clothing, travel and subsidies like lunch. Basically anything that you would not have bought and paid for otherwise, had you not been working in your self-employed role. Tickets for travel are easy to record. If you travel by car you can record costs for mileage as per the government’s up to date guidelines. Prestige Business Management can help self-employed individuals and small business owners complete and return their annual self-assessment tax return forms. Depending on your earnings you may also owe a payment in account on 31 January.
Payment On Account
Self-employed workers pay income tax differently to employees, who have PAYE tax deductions made on their regular wage payments. HM Revenue and Customs (HMRC) uses the figures from your self-assessment tax return filed for the previous year, to forecast how much tax you will owe for the upcoming year. From this they will calculate how much you will be due to pay. This is known as a payment in account. These payments on account are due twice a year for self-employed workers, by the deadlines 31 January and 31 July. This is in order to spread the cost of your forthcoming year’s tax bill.
Penalty for Late Filing
If you miss the filing deadline you’ll be issued a penalty of £100 if your tax return is up to 3 months late. This will increase after 3 months. You will be charged interest on late payments.
Get the Right Support
Our team of accountants and self-assessment specialists can provide the right support and advice for your individual specific needs. This might be capital gains to foreign income, we can help make sure your self assessment tax return is legally compliant and follows the rules set forth by HMRC. Furthermore, our team can help minimise your tax bill and streamline your tax efficiency by identifying all of your allowable expenses.
Prestige Business Management Works for you
At Prestige Business Management we pride ourselves in our communication and our client orientated focus. Find out what we can do for you. Call us today on 0203 773 2927.