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If you are considering becoming self-employed or are required to submit a self-assessment tax return but have questions on how self-assessment tax returns work, then read on. In this article, we will explain all there is to know about tax assessment self returns.
What you will find in this post

What is SATR?

SATR or self-assessment tax return is a system HMRC uses to collect income tax and national insurance contributions.

Who needs to file?

If you earn more than £1000 and run a business as self-employed you will have to submit a tax return.

People who are not self-employed earning over £100k are also required to submit a self-assessment tax return.

If you are employed and have another source of income such as:

  • Money from renting out a property
  • Tips and commission
  • Income from savings, investments, and dividends
  • Foreign income

How to register?

You can register yourself for self-assessment on the GOV.UK website.

 

What information do I need to submit a SATR?

You would need a 10-digit UTR number, you can get this by applying on the link below, or by calling HMRC 0300 200 3310.

You would also need your national insurance number which you would have received when you turned 16. If for some reason you cannot locate it call HMRC on 0300 200 3500.

Other than that, you would need your personal details such as your full name, DOB, address, etc.

 

What is the tax year and when do I apply?

The tax year for self-assessment falls between the 06th April and 05thApril. You will most likely file online, which is due on the 31st January. If – for some reason – you can’t submit online, there is a paper version, which has to be submitted by the 31st October.

When do I need to pay?

Self-assessment will be paid on the 31st Jan for any tax you may owe from the previous year also referred to as a balancing payment, and your first payment on account. On the 31st July you will be due your second payment. 

HMRC came up with this method of payment to help keep individuals stay on top of their tax payments, and not burden them with a large payment on the 31st of Jan. Self-assessment tax consists of income tax, class 2 national insurance and class 4 national insurance.

You can calculate and budget your self-assessment on the helpful tool provided by HMRC.

MTD for Self-assessment

 From 6th April 2023 businesses or landlords earning more than £10,000 will have to submit their tax returns through MTD.  This means that all your bookkeeping and accounting records will have to be kept digitally, via an accounting software.

In this new system, instead of submitting a self-assessment tax return at the end of the year you will send income tax updates to HMRC on a quarterly basis. And even though the frequency will increase to submit tax returns, the payment schedule will remain the same: 31st July and 31st Jan.

I hope this short article has helped you understand a bit more about self-assessment tax returns and given you a bit more confidence over your tax affairs. As always, let me know your thoughts and comments below and any topics you would like us to cover in the future.

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About the Author

Bilal Khalid

CEO, Accountant

Bilal Khalid EvoTax accountant

Successfully running my own small business for years has taught me a great deal about the complexities of taxation and I understand all the pain points that every entrepreneur has to go through. I often found myself paralysed with fear of making a mistake and getting fined and eventually decided to take up accounting and finances myself. Today, I help other small businesses suffering through similar mistakes and I am happy to share my knowledge, jargon free!

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