There is now less than one month left to file your self-assessment tax return online, with the deadline of 31 January fast approaching. While this can seem a daunting prospect, the process can be greatly simplified with a little pre-planning. Book out a few hours in your diary to tackle the job, allowing yourself enough time beforehand to check, locate and gather everything that you will need to get the job done.
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Digits, data and passwords
One thing that is as inevitable as tax itself is the need for passwords, taxpayer references and identification numbers, so do make sure you have these important details to hand. You will need your National Insurance number and your ten-digit Unique Taxpayer Reference (UTR) This latter piece of information will have been given to you when you first registered for self-assessment, and can be requested from HMRC if you have mislaid it. You will also need to know your password to access the online self-assessment tax forms. Allow plenty of time for this to be resent to you if you think there is a chance that you may not have the correct information.
Income records
You will need details of all self-employed and untaxed income from the past tax year (6 April 2018 to 5 April 2019). This includes evidence of income from self-employment, such as invoices and bank statements, as well as dividends and interest form shares. Your P60 form, if you receive one from HMRC, will also show the income on which you have already paid tax to help you make sure you are not setting yourself up to inadvertently pay twice on any part of your income already assessed via PAYE.
Expenses
If you are using a dedicated receipt capture tool or software, this will make gathering your expenses much easier. Such tools store images of receipts and extract the financial data, aligning it with your accounting or bookkeeping software, ready for when you need to submit your tax return. If you prefer to operate with hard copies, make sure that you have all your paper receipts to hand, and that they are eligible for inclusion in the expenses section of your tax return. An accountant or tax specialist can help with this aspect if you are unsure. Typical categories for self-employment expenses might include travel and accommodation such as hotels, subsistence, including meals and applicable client entertainment, services bills, e.g. phone, utilities, business insurance and rent on commercial premises.
Any other business
You can submit other expenses to receive tax relief, such as charitable Gift Aid donations and pension contributions. You will also need to gather up all paperwork and financial information about any state benefits you are receiving, such as Child
Benefit, State Pension, Carer’s Allowance or Blind Person’s Allowance. Don’t forget to factor in any income generated from private pensions or property. Consider whether you need to declare income from renting out property, as well as any profits from large property sales, which would be subject to Capital Gains Tax. The same goes for any shares, trust funds and any other assents or investments that could have generated income in the UK or abroad over the previous tax year.
Details of other benefits will not need to be included on the form, including Attendance Allowance, Personal Independence Payment (PIP), Pension Credit, Working Tax Credit and Child Tax Credit. For a full list and further information about completing your self-assessment tax return, please visit the Government’s website at www.gov.uk.