January 2025

As the self-assessment deadline for the 2023/2024 tax year approaches, it is crucial to ensure timely filing and payment to avoid penalties. The deadline for online submissions to HMRC is 31 January 2025, while the deadline for paper returns was 31 October 2024. Filing on time not only avoids late filing penalties but also ensures peace of mind.

Who Needs to File a Self-Assessment Tax Return?

Not everyone in the UK is required to submit a self-assessment tax return. You need to file if you:

• Earned more than £100,000 in employment or self-employment income
• Are self-employed, a partner in a business, or a director receiving dividends
• Have additional untaxed income such as rental income, dividends, or capital gains
• Claimed child benefit and your income exceeds £50,000 (High-Income Child Benefit Charge)
• Need to report foreign income or claim tax relief under double taxation treaties
• Received income from savings, investments, or trusts exceeding the tax-free allowances

Key Dates and Penalties

Below are the important dates for the 2023/2024 self-assessment cycle:

• 6 April 2024: Start of the tax year 2024/2025
• 31 October 2024: Deadline for paper returns
• 31 January 2025: Deadline for online submissions and payment of any tax owed

Failure to meet these deadlines may result in penalties.

Preparing to File

To submit your return accurately and efficiently, you will need the following:

1. Unique Taxpayer Reference (UTR): This 10-digit number is essential for logging into HMRC’s system.
2. National Insurance Number: Ensure it is current and matches HMRC’s records.
3. Income Documents: Gather payslips, P60s, P45s, bank interest statements, and investment reports.
4. Expenses and Deductions: Record eligible expenses, such as business costs, professional subscriptions, and home office expenses.
5. Foreign Income and Tax Credits: If applicable, include details of income earned abroad and any corresponding relief claimed under international agreements.

Maximising Allowances and Deductions

Careful preparation ensures you make the most of available reliefs and allowances, including:

• Personal allowance: Up to £12,570 (if your income is below £100,000)
• Capital gains tax annual exemption: £3,000 for the 2023/2024 tax year
• Reliefs for pension contributions: Contributions to registered schemes can be tax efficient
• Charitable donations: Qualify for Gift Aid relief

For those filing complex returns, such as reporting overseas income or utilising relief under double taxation treaties, seeking professional advice can be highly beneficial.

Common Mistakes to Avoid

Avoid these common errors when completing your self-assessment:

• Incorrect figures: Ensure income figures match employer records and financial statements.
• Failure to report foreign income: Even if taxed abroad, foreign income must be declared.
• Claiming ineligible expenses: Expenses must be wholly, exclusively, and necessarily incurred for your work or business.
• Missing deadlines for amendments: Corrections can be made up to 12 months after the filing deadline, i.e., until 31 January 2026.

Payment Options and Time to Pay Arrangements

If you anticipate difficulty in meeting your tax obligations, HMRC offers a "Time to Pay" arrangement that allows you to spread payments over a longer period. Applications can be made via your online account. However, interest will accrue on the outstanding balance.

Conclusion

Timely filing of your self-assessment tax return is essential to avoid penalties and interest charges. It also provides an opportunity to ensure your finances are optimised for tax efficiency. If you are unsure whether you need to file or have any concerns regarding your obligations, it is advisable to seek professional assistance.

For personalised support, reach out to us: info.uk@diacrongroup.com   Author: Angelo Chirulli, Head of Tax Diacron London