Who Needs to File a Self Assessment Tax Return in the UK?
Income taxes and National Insurance contributions accounted for 43% of the UK government’s funding in 2021/22, totaling £230 billion and £161 billion respectively.
Much of this is collected from employees via PAYE.
However, many individuals will need to submit a self assessment tax return if they have more complex sources of income that fall outside standard PAYE reporting.
Check If You Need to File a Self-Assessment
Why do I need to submit a Self Assessment tax return?
Most individuals pay income tax via Pay As You Earn (PAYE). This means that the income tax they owe is automatically deducted from their pay before they receive it.
Since many people only have one job and source of income, making sure their PAYE deductions are correct is all they have to do to remain compliant with standard HMRC filing criteria.
Individuals whose circumstances have changed such as those who have stopped being self-employed or no longer receive rental income should also check whether they still need to file, as HMRC does not automatically remove people from self assessment and failing to notify them when a return is no longer required can lead to unnecessary penalties when you no longer need to submit a tax return.
However, if you are getting income from untaxed sources, such as investment income or being self-employed, you will have to declare this to HMRC and pay tax on it. Aside from income tax, you will also need to pay National Insurance contributions on this income.
A self assessment tax return is the mechanism used to report untaxed income to HMRC and calculate what you owe under current tax return requirements.
For individuals who want a broader understanding of how personal tax works in the UK before diving into self assessment specifics, reviewing the full personal tax framework first provides useful context around income tax rates, allowances, and reporting obligations.
Importantly though, Self Assessment is also how you claim Income Tax relief for job expenses that come out of your own pocket, or for pension contributions and charity donations.
How do I know if I must submit a Self Assessment tax return?
You must submit a self assessment tax return if you meet certain self assessment criteria, including the following:
- You were self-employed and earned more than £1000 before tax deductions.
- You were a partner in a business partnership.
- You earned £100,000 or more during the tax year.
- You earned untaxed income such as from rentals or investments.
- You want to claim income tax relief.
These tax return requirements help determine whether HMRC expects you to file outside of PAYE.
Once you have confirmed that a return is required, filing your tax return early rather than waiting until the January deadline gives you more time to gather documentation, identify any reliefs available, and avoid the pressure and technical issues that commonly arise in the final days before submission.
The full list of circumstances that require a tax return is broader than many individuals realise confirming exactly who must send in a tax return helps ensure no reporting obligation is missed, particularly for those with less common income types.
When can I claim income tax relief?
You can claim income tax relief when you have to use your own money to buy items necessary for your work. This is often processed through your self assessment tax return, depending on your self assessment requirements.
You cannot claim relief if your employer gives you all the money back or gives you an alternative (for example, you were given a phone but wanted a different one).
The amount of relief depends on the rate at which you pay tax, and the value of the expense. If you are taxed at 20%, you can deduct 20% of the expenses’ value from your taxable income.
For example, if you pay 20% income tax and you had to spend £100 on fuel for work trips, you could deduct £20 from your total taxable income.
You can claim tax relief on the following work expenses:
- Costs involved in working from home.
- Cleaning, repairing, or replacing a uniform or specialist clothing or tools.
- Using your car for work. For cars, you receive tax relief at a rate of 45p per mile for the first 10,000 miles and at 25p thereafter.
- Professional membership fees.
- Business trip costs, which do not include travelling to and from your home and your regular place of work.
- Substantial equipment such as computers or machinery. You can usually get tax relief equal to the full value of these items as they qualify as a capital allowance.
Pension contributions and charity donations
You get tax relief on private pension contributions worth up to 100% of your annual earnings. This usually happens automatically when your employer takes your pension out of your salary before deducting income tax, or if your pension provider claims it as a tax relief and adds it to your pension pot.
If this tax relief is not done automatically, or if you pay income tax at rates higher than 20%, you can claim this relief on your Self Assessment tax return.
You can also claim tax relief through Self Assessment for charity donations made through Gift Aid or Payroll Giving.
Contact Strategic Accounting & Tax Advisory in Wimbledon
What income counts as untaxed?
You will need to declare any income through a self assessment tax return that has not already been taxed at source, in line with standard HMRC filing criteria.
This includes:
- Money from renting out property.
- Tips and commission.
- Income from savings, investments and dividends.
- Foreign income.
- Some COVID-19 grants.
These categories typically fall outside PAYE and must be reported under standard tax return requirements.
How do I submit my Self Assessment tax return?
You can review our latest guidance on submitting your Self Assessment tax return, including the current filing deadlines, updated HMRC penalties, and ongoing digitalisation of the tax system through Making Tax Digital (MTD).
For individuals who want a clear and practical walkthrough of the submission process, following a step-by-step approach to completing self assessment helps ensure the return is accurate, complete, and filed without last-minute errors.
Individuals who have already submitted a return but realise an error has been made should also be aware that it is possible to make corrections after submission understanding the process for changing your tax return and the time limits that apply avoids unnecessary penalties arising from mistakes that could otherwise be rectified.
If you need help with filing your Self Assessment tax return, our CIMA-registered chartered accountants are here to assist you with accurate and timely submission.
Do You Need to File a Self-Assessment Tax Return in London?
Understanding your self assessment tax return obligations is essential for staying compliant with HMRC and avoiding unnecessary penalties. Cigma Accounting supports individuals and business owners across Farringdon, including clients in Shoreditch and Clerkenwell, helping them determine whether they meet reporting obligations and how to complete filings accurately.
Knowing the correct self assessment criteria and self assessment requirements is key, particularly where income is not fully taxed through PAYE. Our team provides clear advice on HMRC filing criteria and broader tax return requirements, ensuring individuals understand when a return is needed and how to submit it correctly and on time.
Frequently Asked Questions About Self Assessment Requirements in the UK
Who needs to file a Self Assessment tax return?
You may need to file a Self Assessment tax return if you are self-employed, a company director, have untaxed income, earn over certain thresholds, receive rental income, or otherwise meet HMRC’s filing criteria.
What are the main HMRC filing criteria for Self Assessment?
HMRC filing criteria typically include being self-employed, earning income from property, receiving dividends or investment income, having capital gains, or earning income not taxed through PAYE.
What are the Self Assessment criteria for self-employed individuals?
If you are self-employed and earn more than £1,000 in a tax year (before expenses), you usually need to register for Self Assessment and submit a tax return to HMRC.
Do company directors need to complete Self Assessment?
Many company directors are required to file a Self Assessment tax return, especially if they receive dividends, have additional income, or fall within HMRC’s reporting criteria.
What income must be reported on a Self Assessment tax return?
You must report income such as self-employment earnings, rental income, dividends, savings interest, capital gains, and any other taxable income not fully taxed at source.
How do I know if I meet tax return requirements?
You meet tax return requirements if your income sources are not fully taxed through PAYE or if HMRC has specifically asked you to file a return. Checking HMRC guidance or seeking professional advice can help confirm your status.
You may need to file a Self Assessment tax return if you are self-employed, a company director, have untaxed income, earn over certain thresholds, receive rental income, or otherwise meet HMRC’s filing criteria.
HMRC filing criteria typically include being self-employed, earning income from property, receiving dividends or investment income, having capital gains, or earning income not taxed through PAYE.
If you are self-employed and earn more than £1,000 in a tax year (before expenses), you usually need to register for Self Assessment and submit a tax return to HMRC.
Many company directors are required to file a Self Assessment tax return, especially if they receive dividends, have additional income, or fall within HMRC’s reporting criteria.
You must report income such as self-employment earnings, rental income, dividends, savings interest, capital gains, and any other taxable income not fully taxed at source.
You meet tax return requirements if your income sources are not fully taxed through PAYE or if HMRC has specifically asked you to file a return. Checking HMRC guidance or seeking professional advice can help confirm your status.
Unsure If You Need to File a Self Assessment?
Self Assessment is required if you have untaxed income, are self-employed, or need to claim reliefs for pensions, charity donations, or work expenses. Our accountants help individuals and business owners determine filing requirements, calculate liabilities, and submit accurate returns to HMRC on time.
Speak to a Self Assessment Specialist
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CIGMA Accounting offices are at three places across London — Wimbledon, Farringdon, and Fulham.
