Self Assessment

Self Assessment is the system HMRC uses to collect Income Tax from individuals who receive untaxed income. This includes money earned from self-employment, renting out property, investments, savings, and any additional income that isn't taxed at source through the PAYE system. It's also necessary for those who have more complex tax affairs, such as earning over £100,000 annually or wanting to claim certain tax reliefs.

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To file a Self Assessment, you must:

1. Register with HMRC: If you haven't filed a Self Assessment before, you need to register first. You'll then get a Unique Taxpayer Reference (UTR) number, which is crucial for the process.
2. Gather your records: Before filling out your tax return, compile all relevant financial records, including income and expenses related to untaxed income.
3. Complete your tax return: You can file your Self Assessment tax return either online through HMRC's website or by mailing a paper form. The online option is more convenient and gives you a later submission deadline (31st January).
4. Submit by the deadline: The deadline for paper returns is 31st October, and for online returns, it's 31st January following the end of the tax year you're reporting on.
5. Pay your tax bill: Once your return is submitted, you'll know how much tax you owe. Payment is due by 31st January after the end of the tax year. There are several payment options available, including bank transfer, cheque, or Direct Debit.

It's important to remember that failing to file your Self Assessment on time, or accurately, can result in penalties. If you're unsure about any part of the process, consider seeking advice from an accountant or tax advisor.