Whether you are a contractor or registered as a limited company director, it is one of the most significant documents that you will need to complete, and if not completed correctly it can have an impact on the revenue of your business. Our qualified Chartered Certified Accountants can help you with your submission, as well as save you as much tax as possible.
The process can often appear to be complicated and many business owners and contractors often require support through the process. Our team have the expertise to manage this process for you.
The process involves registering on the gov.uk registration page. Once you are registered you will receive a gateway ID which will allow you to set up a personal tax account and file your return. The deadline for submission is 21 January every year for the previous year ended 5th April.
If you are domiciled in the UK and obliged to send a return, make sure that you know the process and are mindful of the deadlines. You should also maintain accurate records of employment-related documents as they will be needed for filing your return properly. It is sent after the end of the taxation year. After that, the HMRC calculates your payable tax based on what you have reported. This process involves online registration and utilisation of HMRC online services.
Completing a Self Assessment Return
To make things easier for you, here’s a step-by-step guide on how to complete your return online:
STEP 1: OPEN YOUR ACCOUNT ONLINE
Visit https://www.gov.uk to set up your online account. Select your form according to the type of employment. You will receive an activation code after your registration.
STEP 2: MAKE SURE THAT YOU HAVE YOUR DOCUMENTS READY
If are not self-employed, your documents will include bank statements and income details. For those who are self-employed, you will need your income records and receipts for expenses. Remember, you will need to get some of these documents from third-party organisations, so make sure that you have your documents ready before the deadline.
STEP 3: SORT OUT YOUR ALLOWANCES
For the year 2019-20, each individual has a Capital Gains allowance of £12,000 while the Personal Allowance has been increased to £12,500.
If you are a higher-rate payer, it is possible to claim higher relief to be allowed on your pension contributions. You can do this by quoting your gross figure. That is the total amount added to the pension after the pension provider has received the basic-rate relief from HMRC. Remember, you don’t have to quote the net amount, which is the amount that you have paid yourself.
STEP 4: DON’T SKIP ANY INCOME
You have to declare any income on which you haven’t paid tax. The income types include:
- Interests from savings
- Dividends from investments
- Incomes from the state pension
- Rental income
- Child benefit payments (if your income exceeds £50,000)
Additional tax-free sources of income include:
- Money held in Isas or Premium Bonds
- Lottery wins
- Money earned from occasional sales on eBay or Etsy
STEP 5: BENEFIT FROM TAX-DEDUCTIBLE EXPENSES
You should claim any deductions that may apply in your case. These expenses include:
- Gift aid on your charitable contributions
- Membership expenses for conservation charities, museums and zoos
- Membership expenses for professional bodies that are required for your employment
- Self-employed individuals can claim to get the costs of using a car (but not the buying cost)
- Landlords may claim back any expenses that are necessary for renting out their property, such as maintenance costs, advertising costs or agents’ fees.
STEP 6: SORT OUT YOUR NICs
For the year 2019-20, the Class 1 National Insurance threshold is £8,632 per year. If your income is below this, you will not pay National Insurance Contribution, and if your income is higher than the threshold, your contribution will be as follows:
STEP 7: CHECK YOUR DETAILS THOROUGHLY
Before you press the ‘Submit’ button, ensure that all the details that you have entered are correct. If you are filing online, you can easily save your work and access it later in case you need to double-check your numbers.
Tip: To simplify the process, get professional help. A good accountant can assist any individual, contractor or company with the filing by handling all the documents and fulfilment of the requirements on your behalf. When you put someone, who knows this process inside out take charge, you will save time and energy, prevent stress and will have mental peace knowing that there won’t be any mishaps.
HOW OUR SELF ASSESSMENT ACCOUNTING TEAM CAN HELP
At Finance Equation, we can make your process as stress-free as possible. We manage complications that can arise from completing a tax return and will take care of your submission.
For support with your Self-assessment contact us for a no-obligation discussion with one of our experts.
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Finance Equation Ltd are multi-award-winning Chartered Certified Accountants providing cutting-edge expert services to individuals, property investors, businesses and contractors.
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The Finance Equation Ltd is a company registered in England & Wales. Company number 05116983. Business address: Finance Equation Ltd, 334 Ley Street, Ilford, Essex, IG1 4AF.