Required information for Self-Assessment Tax Returns
Not one’s person’s self-assessment tax return is the same and not every page will apply to everyone, and some people may find themselves filling in every section while others only need to enter little data. Nevertheless, if HMRC sends you a Notice to Complete in May then it is your duty to send a Tax Return to HMRC by the deadline dates; 31st October for paper returns and 31st January for online submissions.
Individuals who have only income that is already taxed at source (commonly employment or pension income) below £100,000 will not need to prepare a Tax Return. This can change if they decide to start working through self-employment and earn more than £1,000, if they start renting out a property or even sell another property, or if they receive dividends in excess of £2,000. If you ever receive untaxed income and are unsure if a tax return is required it is always ideal to speak to an accountant for clarification. All documentation of any received income should be kept for at least 7 years. If you are required to fill out a tax return you will need to include all your income on the form. This includes:
• Income that has already been subjected to tax deductions such as employment income or pension income. The P60 you receive in May will have the payable amount and tax deductions information you need for the tax return.
• State pension usually found on HMRC’s online portal or from adding up the bank statement figures.
• Rental income from letting out a part of your properties to tenants.
• The sales income and purchase expenses of any self-employment work
• Bank interest paid into your bank accounts
• Dividends received from companies you hold shares for
• Foreign income; money for selling products or services abroad, dividends from overseas companies, bank interest from overseas bank, rental lettings abroad, and any other income earned outside the UK.
• Sales of a non-main residence property, shares, or personal items over £6,000 excluding cars.
When Making Tax Digital comes into effect for Self-Assessment, a year end submission will still be due to HMRC alongside the quarterly reports. Submitting quarterly reports to HMRC will give an individual an estimate of their final tax bill at the end of the year and to help them manage their finances in preparation for this bill. Making Tax Digital is set for self-assessment no earlier than April 2020. The quarterly reports are only relevant for self-employed individuals and landlords who would have their information to hand to prepare the reports over the months. Currently, employers and pension providers do not send the P60 income summaries out until after the 5th April for that tax year, so the final tax bill can vary from the estimated figure depending on how HMRC intend to collect this information to ensure the estimate for landlords and self-employed individuals is correct. Tags:
Self-assessment, tax return, personal tax