Tax

Self-assessment tax return (SA100)

The self-assessment tax return is usually for individuals who work for themselves in business or receive untaxed income from a source.

This document reports untaxed income, allowing HMRC to calculate your tax liability.

Sole traders, partners, partnerships and any individual who has income from another source which has not been declared or taxed (such as property rental income or investment income from stocks and shares, or interest income etc) have to submit self-assessment returns to declare their personal / business profits, which are used to determine their income tax bill.

Directors of limited companies have to complete a self-assessment tax return (also referred to as a personal tax return) if they receive income from their limited company that has not been taxed through PAYE (Pay As You Earn). For instance, if a director works for their company and receives a monthly payslip, their salary is being taxed at source. However, suppose they also receive a dividend or any other form of income from the company or any other source, such as interest from savings, stocks and shares income, income from investment properties etc. In that case, they need to complete a self-assessment tax return to declare this additional income.

Self-assessment tax return (FAQs)

What is an SA100?

The SA100 is the main tax return for individuals.

The difference between your SA302 and your Tax Year Overview is that the latter is a statement of your tax bill for the tax year, the amount of tax you’ve paid and any tax payments that are outstanding. As well as your SA302 form, lenders will also ask to see your HMRC Tax Year Overview.

You can access your Tax Year Overview at GOV.UK by taking the following steps:

Log into your HMRC online tax account
Select Self-Assessment (if you are only registered for Self-Assessment, then you’ll automatically be directed to this screen)
Select Self-Assessment Overview
Select View Account
Follow the link Tax Years
Select the year from the drop-down menu and click the Go button
Follow the link Print your Tax Year Overview

Example of SA100

Example of Tax Year Overview

Example of Tax Year Calculation

What is an SA302?

The SA302 is a brief summary of the income that has been reported to the HMRC

Accessing your SA302 from HMRC’s online services

You can download and print your SA302 form as follows:

Log in to your HMRC online account using your Government Gateway account details
Go to Self-Assessment
Click More Assessment Details
Download and print your SA302 from here

What information does SA302 contain?

On your SA302, you’ll find the details around your SA302 tax calculation, as well as more Self-Assessment details, such as:

Pay from any employment
Profit from self-employment
Profit from UK land and property
dividends you’ve received from companies
Details of UK pension and benefits
Income Tax calculations

Example of SA302

Do I have to complete a self-assessment (SA100) tax return?

Self-Assessment Tax Return (SATR) is only necessary for people who are self-employed, like sole traders, partners, or if you have an income from another source which has not been declared or taxed such as property rental income or investment income from stocks and shares, or interest income.
Check if you need to send an SATR using HMRC’s online tool

Does my business need a separate self-assessment tax return?

In certain circumstances, a business also needs a separate self-assessment tax return. For example, partnerships submit returns that deal with the business, while individual partners each submit their own returns that deal with their income from the business.

How to submit your self-assessment tax return?

You can submit your Self-Assessment return online but there are certain exceptions, such as partnerships, which have to submit their return by post. However, partners can still file their individual returns online. You can also hire an accountant to assist you in calculating and submitting your self-assessment tax return.

How to register for a self-assessment tax return?

You must register for self-assessment to submit a tax return. The registration process differs on the basis of the SATR you are submitting,

Self-employed sole traders can register for Self-Assessment online..
Partners have to register using an SA401 form
The nominated partner has to register the partnership separately with an SA400 form.
If you’re not self-employed but need to register for self-assessment for a different reason, such as declaring income, you make through property, or because you’re the director of a limited company, you can register using an SA1 form.

The deadline to register for Self-Assessment is 5^th October.

What happens after successful registration?

Upon successful registration for self-assessment, HMRC will give you a Unique Taxpayer Reference (UTR).

You have to provide UTR every time you file your tax return.

If you’re a partner in a partnership, you’ll receive an individual UTR number, as well as one for the partnership itself, to ensure there is no confusion.

It typically takes around two weeks to receive your UTR number or up to three weeks if you’re living abroad.

Deadline for submitting a self-assessment tax return

The deadline for submitting your self-assessment tax return varies depending on the method you have used.

If you opt for a paper tax return, it has to be submitted by 31st October in the same year the tax year ended, i.e. submit your 2021/2022 tax return by post by 31^st October 2022.
If you prefer to file your tax return online, the deadline is 31st January in the year following the tax year ended, i.e. submit your 2021/2022 tax return online by 31^st January 2023.

If you file late then there is usually a £100 fine by HMRC.

Limited Company Tax Returns (CT600)

Limited companies are required to file a Company Tax Return every year to report their profits and determine the amount of Corporation Tax owed to HMRC. This return is separate from the director's personal income (non-PAYE income), which is reported through a Self-Assessment tax return and in some cases, through the company pay roll, too.

The company tax return is commonly known as the CT600 form, which is used by limited companies to provide HMRC with accurate financial information about the business. This is crucial for ensuring compliance with UK tax laws and regulations and enables HMRC to see the profits, which is then used to determine the amount of Corporation Tax due. It is important for companies to submit their CT600 form on time and with accurate information to avoid any penalties or fines. As well as company tax returns your company has to prepare and file the annual year end accounts

Limited Company Tax Returns (FAQs)

Do I need to file a Company Tax Return (CTR)?

If you operate a limited company, then you have to file a company tax return to report the finances of the business.

CTR differs from the personal income of the directors, which is reported through Self-Assessment. Many limited companies also enroll in PAYE as an employer and compensate their directors with a small salary through payroll.

What happens after I form a Limited Company?

You will receive a confirmation regarding the registration of your company.
HMRC will issue a Unique Taxpayer Reference (UTR) number to identify your company as a taxpayer.
You will also receive an activation code (keep this very safe) to access your company data online at companies house.
Every year you will then have to prepare and file your company accounts (annual accounts) to Companies House.
File a Confirmation Statement
You will also have to prepare and submit your Corporation Tax to HMRC.

This is where we can help do these for you and ensure they are done correctly.

How do I file my Company Tax Return to pay Corporation Tax?

Limited companies have to submit online company tax returns with the CT600 form. In certain circumstances, there are exceptions which allow you to submit a paper return they can submit it on paper, but they have to add a separate WY1 form.

How can I notify HMRC that I need to file a Company Tax Return?

As a Limited Company owner, you don’t have to do much to notify HMRC that you have to file a Company Tax, as when you establish your limited company or incorporation, you have to register it with Companies House. This process automatically alerts HMRC, so they will anticipate receiving a company tax return from you.

You have to register your new limited company within three months of starting it, even if you are creating a company that will remain dormant.

An Accountant can help you set up your limited company.

When should I submit my company tax return?

As a limited company owner, you have to submit a tax return on a yearly basis and have to pay attention to some important deadlines.

You have to submit a company tax return 12 months after the end of the accounting period.
You have to pay your corporation tax bill 9 months and one day from the end of the accounting period that it is for.

In addition, as a director of a limited company, it is essential to fulfilling certain obligations:

Submit your Personal Self-Assessment tax return online
Submit accounts to Companies House. The deadline for this is 9 months from the end of your accounting period. You can make a request to modify this period though.

Submit a Confirmation Statement annually

Can I use an accountant for my company's tax return?

Of course, You don’t have to handle every or any aspect of your company tax return and can take assistance from a qualified accountant to prepare your accounts and tax returns. A proficient tax accountant can also guide you in maximizing your company’s tax efficiency. This entails several considerations, such as ensuring that your business structure is most suitable for your specific circumstances and claiming tax relief on all allowable expenses. This can result in a significant reduction in your tax liability.

VAT Return

You only need to submit a VAT (Value Added Tax) return if your business is registered.

VAT is a tax that businesses must add to their products or services if they exceed a certain annual turnover or are VAT registered. It is possible to voluntarily register for VAT, but it is recommended to seek advice from an accountant on the advantages and disadvantages of doing so. However, if your turnover in the previous 12 months exceeds the current VAT threshold of £85,000, VAT registration is then mandatory. The threshold of £85,000 is fixed until March 2024.

It is important to note that certain products or services are VAT exempt or subject to a reduced rate of VAT.

VAT Return (FAQs)

Benefits of Seeking Professional Assistance

A good accountant can help you with your VAT responsibilities. They can assist you in preparing your VAT return and guide you in maximising your company’s tax efficiency. Whether you choose to prepare your VAT return on your own or seek assistance, it is beneficial to have a comprehensive understanding of how VAT affects your business to save time and money in the long run.

Is it necessary to submit a VAT return?

A VAT return is only required if your business is registered for VAT.
To register for VAT, your turnover in the previous 12 months must exceed the registration threshold.
You can register voluntarily if you believe that it can increase your tax efficiency. If you are not VAT registered and do not require registration, then you do not need to complete a VAT return

How do I submit a VAT return?

Submitting VAT returns has been impacted by the introduction of Making Tax Digital (MTD).

Businesses with a turnover exceeding the registration threshold need to submit their returns under MTD rules.
It will become compulsory for all VAT-registered businesses from their first VAT period beginning on or after 1st April 2022.
This requires you to keep digital tax records and submit your VAT return electronically with either bridging software or MTD-approved software.

What are different VAT schemes?

There is a wide range of VAT schemes, among which selecting the one that benefits your business the most can have a significant impact on your VAT return and bill.

The HMRC website provides complete details about every scheme. You can even hire a reliable tax accountant to ensure that you have the best scheme for your business.

Is it possible for me to switch to a different VAT scheme?

Yes. You, have the freedom to transition from one VAT scheme to another. You can switch your accounting method from cash to accrual, or you can even cancel your VAT registration altogether. However, remember that any modifications to your VAT registration must adhere closely to the guidelines and will impact the timing and method of your VAT return submission.

Reclaiming VAT

VAT is classified as INPUT and OUTPUT

If you’ve paid more VAT than you’ve collected from sales, HMRC will issue a refund to you following the submission of your VAT return. Typically, this reimbursement process takes approximately 28 days to complete.

CIS Tax Return

The CIS return is a similar concept to the PAYE scheme which employers use but is used in the construction industry for contractors and sub-contractors

The Construction Industry Scheme (CIS) is a scheme that ensures compliance and transparency within the construction industry. It allows contractors to provide HMRC with a monthly report about any subcontractors they’ve paid that month, how much they paid them, and about any deductions.

The contractor deducts tax and national insurance from their subcontractors’ pay and then sends it to HMRC

CIS Tax Return (FAQs)

Do subcontractors have to submit their own tax returns?

Subcontractors also have to submit their own tax returns, which have to include details of their income and deductions. The type of tax return required is dependent on the structure of the subcontractor’s business.

Sole traders or partners must submit a Self-Assessment tax return, while limited companies must file a company tax return.

Do I need to inform my subcontractors about my CIS return?

Only subcontractors that have tax deducted from their pay are required to receive a CIS statement, although it is best practice to provide one regardless.

What CIS registration means for CIS returns?

Contractors must ensure that their subcontractors are registered for CIS with HMRC, as this has a significant impact on the amount of tax that is deducted from their pay.

If the subcontractor has gross payment status, no deductions are made.
If the subcontractor is registered, a 20% deduction is made.
If a subcontractor is not registered or cannot be verified by HMRC, a 30% deduction is made.

It is important to include the details of these deductions each time a CIS return is submitted to HMRC. This ensures that HMRC is aware that the subcontractor has already paid the appropriate amount of tax.

When should I submit a CIS return?

CIS returns must be filed monthly, reporting the previous tax month’s activities from the 6th to the 5th of each month, with a deadline of the 19th of the following month. If you don’t use any subcontractors one month, the submission of a CIS return is unnecessary, but you will still need to notify HMRC that no payments were made otherwise you could receive a penalty.

Should I hire an accountant for a CIS return?

You can take professional assistance from an accountant for calculating and filing your CIS return.