If you are self employed (and your income was more than £1,000) or earned money outside of wages and pensions, you must fill out a tax return for HMRC.
As April marks the start of the new financial year, those who are self employed or a partner in a business partnership can fill out a HMRC self assessment for from April 6 2022.
If it is your first time filling one out, it can appear daunting and you may not know exactly where to start.
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But by completing one, you can receive tax back, claim Income tax reliefs and prove you’re self-employed, for example to claim Tax-Free Childcare or Maternity Allowance.
According to Gov.uk: You will not usually need to send a return if your only income is from your wages or pension. But you may need to send one if you have any other untaxed income, such as:
- Some COVID-19 grant or support payments.
- Money from renting out a property.
- Tips and commission.
- Income from savings, investments and dividends.
- Foreign income.
The deadline to fill it out is midnight January 31 2023 (October 1 2022 if filing a paper tax return) for the last tax year that started on April 6 2021 and ended on April 5 2022.
Information you need before completing the form
To fill it out, you will need these things if they apply.
- Ten-digit Unique Taxpayer Reference (UTR).
- National Insurance number.
- Details of your untaxed income from the tax year, including income from self-employment, dividends and interest on shares.
- Records of any expenses relating to self-employment.
- Contributions to charity or pensions that might be eligible for tax relief.
- P60 or other records showing how much income you received that you’ve already paid tax on.
How to fill out HMRC Self Assessment
Firstly, you need to register for self assessment if you are self employed, registering as a partnership and if you're not self employed but still need to fill out a self assessment form for reasons above. You can do that through Gov.uk. You must register by 5 October 2022
You should be keeping a record of all your payments and outgoings on what you can claim back.
As MoneyHelper explains, If you earn from renting out a property, you can claim expenses for the following.
- Rates, insurance and ground rent.
- Property repairs and maintenance.
- Loan interest and other financial costs.
- Legal, management and other professional fees.
If you're self employed you can claim expenses such as;
- Cost of stock bought for resale.
- Cost of equipment used at work.
- Wages, salaries and other staff costs.
- Payments to subcontractors (if you work in the construction industry).
- Vehicle and travel expenses.
- Work building costs (including rent, power and insurance).
- Repairs and maintenance for work buildings and vehicles.
- Office costs (including internet access, phones and stationery).
- Advertising and business entertainment costs.
- Interest on loans.
- Bank, credit card and other financial charges.
- Accountancy, legal and other professional costs.
If you are self employed and received the Self Employed Grant, this also needs to be declared.
Once you've submitted your Self Assessment form, you'll be told how much tax you owe HMRC and you have until January 31 2023 to pay it.
If you're three months late in filing the form or paying tax, there is a £100 fine. This will increase if it is later.
You can also find help sheet on Gov.uk.
