Self Assessment Tax Returns
Self Assessment is a system HM Revenue and Customs (HMRC) uses to collect Income Tax. Tax is usually deducted automatically from wages, pensions and savings but people and businesses with other income (typically sole trader profits or dividends) must report this information in a yearly tax return.
The self assessment filing deadline for the 5th April each tax year is always the 31st January of the following year. Any tax returns not submitted to HM Revenue & Customs by this date shall incur fines starting at £100.00.
Company Tax Returns
Your company or association must file a Company Tax Return if you get a ‘notice to deliver a Company Tax Return’ from HMRC.
You must still send a return if you make a loss or have no Corporation Tax to pay. You do not send a Company Tax Return if you’re self-employed as a sole trader or in a partnership – but you must send a Self Assessment return.
The deadline for your tax return is 12 months after the end of the accounting period it covers. You’ll have to pay a penalty if you miss the deadline. There’s a separate deadline to pay your Corporation Tax bill. It’s usually 9 months and one day after the end of the accounting period.
Contractors Construction Industry Scheme Returns
Contractors must register for the scheme and complete a monthly form up to the 5th of each month which must be submitted electronically by a deadline of the 19th of each month. Failure to comply shall result in a penalty from HMRC of £100.00 for each month that a return is late.
Value Added Tax (VAT) Returns
If you have voluntary registered for VAT or your business turnover is above the registration threshold (currently £85,000) you will need to submit a VAT Return to HM Revenue and Customs (HMRC) every 3 months. This period of time is known as your ‘accounting period.’ The deadline for this information to be submitted to HMRC is the 7th day of the second month following the end of the accounting period.
The VAT Return records things for the accounting period like:
- your total sales and purchases
- the amount of VAT you owe
- the amount of VAT you can reclaim
- what your VAT refund from HMRC is
You must submit a VAT Return even if you have no VAT to pay or reclaim.
Penalties will be issued by HMRC on a percentage basis for any late VAT returns submitted.
PAYE and National Insurance
As an employer, you normally have to operate PAYE as part of your payroll. PAYE is HMRC’s system to collect Income Tax and National Insurance from employment.
Payments to your employees include their salary or wages, as well as things like any tips or bonuses, or statutory sick or maternity pay.
From these payments, you’ll need to deduct tax and National Insurance for most employees. Other deductions you may need to make include student loan repayments or pension contributions.
Every employer will need to report their employees’ payments and deductions to HMRC on or before each payday. If HMRC receives this information after an employee has already been paid, a penalty will be incurred. These penalties start from £100.00.