Self-employed workers need to act now to avoid £100 tax return fine

Self-employed workers need to act now to avoid £100 tax return fine

Self-employed workers and high earners who are submitting a paper version of the self-assessment tax return need to act now to avoid a £100 fine.

The deadline for HMRC receiving your form is this Sunday (October 31) which means you need to get your tax return in the post today to make sure it arrives on time.

Most UK taxpayers have their taxes deducted automatically from their wages, pensions or savings.

But individuals who work for themselves, businesses who haven’t had tax deducted, or those who have earned extra untaxed income, will need to fill out a self-assessment form.

We explain below who needs to submit a tax return:

Do I need to submit a self-assessment tax return?

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If the following applies to you for the 2020/21 tax year, you will need to fill out a self-assessment form:

  • Your self-employment income was more than £1,000

  • Your income from renting out property was more than £2,500

  • You earned more than £2,500 in untaxed income

  • Your income from savings or investments was £10,000 or more before tax

  • You need to pay Capital Gains Tax on profits from selling things like shares or a second home

  • You’re a director of a company (unless it was a non-profit organisation)

  • You, or your partner’s, income was over £50,000 and you’re claiming Child Benefit

  • You have income from abroad you need to pay tax on

  • Your taxable income was over £100,000

  • You’re a trustee of a trust or registered pension scheme

  • Your state pension was more than your personal allowance, and your only source of income

How do I send off my self-assessment tax return?

If you’ve chosen a paper tax return, you’ll need to send an SA100 and make sure it is received by this Sunday (October 31).

You should have already received this form in the post if you’ve opted for a paper return.

It is important your self-assessment arrives on time, as you can still be fined £100 if it is late even if you don’t have any tax to pay.

If you’re really worried about your paper tax return being late, you can submit it online instead.

Those who submit their tax returns online have until January 31, 2022 to file their self-assessment.

You must register for self-assessment through the HMRC website if you didn’t send one last year, and the deadline for doing this was technically October 5, 2021.

It can then take a further ten days working days for you to receive your reference number.

If you already have a reference number – for example, because you’ve previously filed a paper return – you should be able to skip this step and just register for the online service.

If you are more than three months late, HMRC can add an extra £10 a day penalty for the next 90 days, bringing the total find to £1,000.

Late penalties were suspended through the pandemic, but this is no longer the case.

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