Self Assessment Tax Return: handy tips & hints

Self Assessment Tutorial

In this tutorial our aim is to give you some advice how to make the completion of a Self Assessment Return easier!

Tips & hints to complete your Self Assessment Return:

1. Don’t leave it to the last minute! Rather obvious perhaps but unless you are a pro (and if you were,  you probably wouldn’t be reading this…..), your Self Assessment is likely to involve some “iteration”. You are probably going to find you are missing a piece of information, or you may need to ask for advice at some stage. Much nicer not to have to come to that conclusion at 23.45 on the 31st January, as well as better for your blood pressure and overall health. Similarly phoning HMRC Self Assessment helpline in January  requires  stamina, a sense of humour & plenty of time (trust me on this one…..)! In addition the HMRC Self Assessment website will be heavily used in the last few days ahead of the final deadline with all possible associated issues (stability, time taken to file etc.)

2. Get organised! Before you sit down in front of your “electronic device of choice” (if you had wanted to file a paper return, you should have done so by 31 October last year, and therefore digital is the only option at this stage I’m afraid), check that you can log-on to your government gateway account*, think about all the bits of information you will need & gather them all together, e.g.**:

  • evidence of income from employment or pensions (e.g. P60, P45 & possibly P11d for any benefits in kind not processed by your employer through Payroll)
  • evidence of Savings Income received (e.g. Interest from Banks & Building Societies, Dividends from stocks & shares etc.)
  • Details of any Property income (buy-to-let, holiday lets etc.)
  • Other UK income such as employment lump-sums. redundancy pay-outs, share schemes, life insurance gains & income from settlements or trusts)
  • Any chargeable gains or losses (have you sold any shares, property or other investments? You may have to pay Capital Gains Tax if it exceeds the annual allowance of £11,100 in the 2016/2017 Tax Year)
  • Details of Expenses you have incurred relating to your job & any allowances you want to claim for (e.g. Gift Aid contributions & any Personal Pension contributions not deducted from your salary), as these will reduce you tax bill
  • Income from self employment or partnership (Trading Income). Remember Capital Allowances & your Annual Investment allowance as these can reduce your tax bill
  • Any gifts received or made by you
  • More “exotic” items such as Foreign Income, Residency, as well as Venture Capital & Investment Schemes deductions etc.

3. Did you know that you can deduct fees or subscriptions to some approved professional organisations, if you have paid them yourself? Please note that you must have the membership to do your job, or it’s helpful for your work. Attached link allows you to check whether your “professional organisation or learned organisation” is HMRC approved

4. if you have used your own vehicle on business for your job and you have not been reimbursed by your employer, you can claim a tax deduction of 45p/mile on first 10,000 business miles and 20p/mile for business miles above this threshold. If your employer has reimbursed mileage at lower rates than these official HMRC rates, you can claim the difference as a deduction

5. Even if you have gifted or transferred an “asset” for free, these are seen by HMRC as a “disposal” and you may still need to pay Capital Gains Tax on it (if the gain exceeds your Annual Allowance of £11,100 in the 2016/2017 Tax Year). You incur Capital Gains Tax on the gain you make when you sell an “asset”, including

  • most personal possessions worth £6,000 or more, apart from your car
  • property that is not your main home
  • your main home if you’ve let it out, or used it exclusively for business or it’s very large (house & ground larger than 5,000 m2 (0.5 hectare), or just over 1 acre)
  • shares that aren’t in an ISA or PEP
  • business assets

6. You can ask HMRC to reduce any “Payments on Account” that have been calculated for the following tax year.  For example if you expect your income to be lower in the next tax year (e.g. you have chosen to work less or you have lost a big customer etc.), or if you had a large one-off income or gain in the last tax year

7. On the Self Assessment Return only fill in the boxes that apply, don’t fill in “0” or “nil”. Leave blank or empty otherwise

8. You can use ‘provisional’ or ‘estimated’ figures if you can’t recreate all your records (e.g. if they have been lost or destroyed). ‘Provisional’ means you’ll be able to get paperwork to confirm your figures later. ‘Estimated’ means you won’t be able to confirm the figures. You must use the ‘Any other information’ box on the tax return to say that this is what you’re doing. In addition you may have to pay interest and penalties if your figures turn out to be wrong and you haven’t paid enough tax.

9. Once submitted make sure you get a “submission reference/ID” &  retain an (electronic) copy as proof!

10. Remember to Pay HMRC by 31 January 2018 at the latest, to avoid late payment fines & interest charges. HMRC must have received any Tax Payable in “cleared funds” (important for payment by cheque), by that date.

Where can I get some help?

  1. HMRC’s Online Self Assessment Guide
  2. I have already mentioned HMRC’s Self Assessment helpline; here is the telephone number:   0300 200 3310.  Remember to have your Unique Tax Reference (UTR, a 10 digit number) as well as your National Insurance number ready to hand.

If you prefer to have a professional complete you Self Assessment Return on your behalf, why not get in touch & let Tulip Thistle Accountancy complete this work on your behalf?