How to do tax return online? Filing it online may appear onerous, but proper planning can alleviate the burden. Also, good guidance is helpful. If you need to file a tax return online, we’ll provide some pointers. But, of course, we understand it’s a bit of a pain, so we don’t blame you.
Why do you need to file a tax return?
Employees, or those who work for a firm, often have tax deducted automatically at the source from their wages. People and enterprises with other income that is not deducted at the source and exceeds a particular threshold, on the other hand, are required to disclose it. Individuals and businesses in this category must complete a Self-Assessment tax return. For example, if you worked as a sole trader and earned more than £1,000, you must file a tax return. In addition, if you are a participant in a commercial partnership or a director of a limited company, you must file one.
What if I have untaxed earnings?
Even if your primary source of income is your wages, you may still be required to file a tax return. Why? If, for example, you were paid more than £100,000 through a PAYE salary scheme and have any other untaxed income, such as rental income, tips and commission, savings, investments, and dividends. Additionally, overseas income is also counted.
HMRC notices you’ll need to take note of
If Her Majesty’s Revenue and Customs (HMRC) has notified you that you must file a return, you must do so. Even if you haven’t received such a notice from HMRC, you may still be required to file a tax return. How is this so? This might become necessary if you had a new source of income or capital gains in the previous tax year on which you must pay tax. If so, notify HMRC immediately.
How to do tax return online?
If you’ve never previously filed a tax return, you must create an HMRC online account. According to HMRC, many people submit tax forms online since it’s simple, secure, and available 24 hours a day. You can easily sign up for email notifications and online messaging to help you manage your tax affairs. After you sign up, HMRC will send you an activation number, which may take up to ten working days to arrive. You’ll also be assigned a user ID and a Unique Taxpayer Reference (UTR).
Information you’ll need before applying for self-assessment
- You’ll need your Unique Taxpayer Reference Number (UTR).
- Your National Insurance number and employer reference, if you have one.
- You may need your P60 end of year certificate.
- P11D expenses or benefits.
- P45 Details of leaving work, payslips, and your P2 PAYE coding notice.
- Bank or building society statements.
- If you work for yourself, you have a profit or loss account.
What you should be aware of when submitting the self-assessment
Send no receipts, accounts, or other paperwork to HMRC supporting your Self Assessment return unless specifically requested. Even so, send copies and keep the originals safe. You’re responsible for the information you submit, so take your time filling out your return information. Enter the figures with care and double-check everything before clicking the submit button. In your reply, include as much information as possible. Before you hit the final submit button, you can go back and amend any figures. However, if you require the services of a tax returns accountant, don’t hesitate to get in touch with Taxback. We’re a UK tax accountancy firm based in Gloucester Road, West London, and we can help you with tax returns online UK.
What more do you need to be aware of?
If you apply for tax return and file tax return online on time, you must keep records of all the information required. This includes information needed to submit your self-assessment tax returns, such as your accounts and other details. Self-employed individuals should keep this for up to five years after January 31st. If HMRC comes knocking, you may face hefty penalties for each failure to retain or preserve proper paperwork.
Penalties for filing late and appeals
If you file after the given deadline or pay late, you’ll generally have to pay the penalty. You can, however, appeal a penalty if you have a valid reason. If your tax return is late by up to three months or you pay your tax payment late, you may be fined £100. If you pay later, you will have to pay extra, and HMRC will apply interest on late payments. After three months, a more complicated system of fines based on daily penalties and so-called tax gear penalties is in place.
Can a UK tax accountant handle this for you?
Suppose you’re preparing your tax return and are concerned that your online access to the HMRC website will not be available in time to file by the 31st of January. In that case, all is not lost-an accountant for tax returns may be able to file your return for you using their unique agent logins with HMRC. Taxback is one of the UK’s oldest and most comprehensive tax refund firms, and we provide tax return UK assistance and guidance.
How much should you set aside as tax
It’s a good idea to set aside a reasonable amount of money each month for your tax payment, especially if this is your first year as a self-employed person. Set aside a quarter of your profits for tax purposes as a general rule. Increase that to a third if you’re a higher-rate taxpayer.
Final words
Filing your returns late also raises the likelihood of HMRC scrutinising your return. So, fill out the form as soon as possible to avoid tension and missing a deadline. Keep in mind that as January 31st approaches, the online service and tax experts will become busier. If you believe you will miss a tax payment deadline, contact Taxback right away. Furthermore, if the deadline comes on a weekend or bank holiday, ensure that your payment arrives at HMRC on the last working day before the deadline. This does not apply if you pay using quicker payments or a debit or credit card.