How to fill in your self-assessment tax form

Make filling in your annual HMRC self-assessment return pain-free with our handy tax return tips and advice.

No sooner are the Christmas decorations packed away and the last mince pie polished off, then tax return season is upon us.

More than 11 million of us have to submit an annual self-assessment form to HM Revenue & Customs (HMRC) by January 31 each year.

This form allows us to calculate how much income tax we owe, which must be paid to HMRC before the given deadline.

Here are our top tips to make filing your annual self-assessment as pain-free as possible.

Check that you need to fill in a self-assessment form

If you receive a tax return form or notice for self-assessment, you're legally obliged to complete it and it's up to you to correctly self-assess your tax liability.

According to government figures however, more than 400,000 people move out of self-assessment each year, so it's worthwhile checking that you actually need to fill in a tax return before you start.

If you work as a sole trader, are in a business partnership, or are a company director and have drawn a salary within the financial year, you must file a tax return.

This is also true if you're employed and pay tax through PAYE but earn self-employed income as well.

Other circumstances may require you to fill in self-assessment too such as claiming back additional tax relief on your pension contributions if you're a higher rate taxpayer or if you are a landlord in receipt of rental income.

If you don't think you need to file a tax return, you can tell HMRC that you no longer need to send a tax return:

• by filling in an online form - you’ll need to sign in to submit the form
• online using HMRC’s digital assistant
• by phone or post. 

You’ll need to provide your National Insurance number and your UTR number.

If you fail to submit a tax return by HMRC's deadlines, you'll face an automatic £100 penalty and then additional penalties and interest on the tax you owe.

Register for online self-assessment account

Your tax return can be filed online or on paper. 

There are several key benefits to doing this online including

• You can file later - the self-assessment deadline for paper returns on October 31st while the deadline for online submissions is January 31st following the end of the tax year.
• Your tax return is immediately acknowledged by HMRC so there's no worry about it getting lost in the post.
• The tax and National Insurance contributions you owe are automatically calculated for you to see, and you can adjust payments.
• You can save or print a copy for your records.
• Check your account at any time to see what tax you owe and previous tax payments.

To submit your tax return online, you must first register for an online account on the HMRC website.

You'll be sent an activation code through the post, so it's best not to leave this to the last moment.

Gather all your paperwork

Before starting to complete your form, gather together all the necessary paperwork.

This will include records of your business's sales and income, bank statements and business expenses.

You may also need a P60 form from your employer showing your income and the tax you've paid on it or a P45 if you left a job within the tax year and a P11D or P9D showing any benefits and expenses.

Don't forget details of the interest you've received on bank or building society accounts, dividends from investments and any other income you receive.

Hire an accountant or tax agent

Filing your tax return online is relatively straightforward with YouTube videos to help you complete each box.

However, if your tax situation is complicated and you expect a hefty tax bill or you're unsure about any aspect of your tax return, then employing an accountant may be a good option.

Take care to ensure that your chosen agent or accountant is reputable and knowledgeable. 

It's important to remember that, even if an accountant prepares and files your tax return, you are still responsible for ensuring that it is accurate; you can always ask your agent questions to clarify your understanding. 

You may also want to check HMRC’s guidance or get a second opinion if your tax affairs are complex.

Expect to pay at least £150 to hire an accountant to help you fill in your tax return but their knowledge of tax legislation and what can be claimed as expenses could save you far more in paying less tax.

Turn to the HMRC for help

If you decide to forgo the expense of an accountant and do it yourself, don't fret if you're uncertain about what to put in any given field on the form.

If you've a query, head first to the self-assessment area of HMRC's website.

Here you'll find a collection of videos and worksheets that should answer most of your questions.

If you're stuck on a particular area, you can use HMRC's Digital Assistant if you need to ask further questions about Self Assessment or have a specific query. 

You can also ask to chat with an adviser, if one is available, but be aware you may have to wait to speak to an advisor especially during busy times close to the tax return deadlines.