If you’re self employed or you have income from a variety of sources then you may well have to complete a Self Assessment tax return every year.
Our guide looks at four important things you should know about your Self Assessment tax return 2011.
Different methods of submission
There are two ways that you can complete your self assessment tax return. You can either send a paper based tax return or you can fill it online.
Increasing numbers of people are using HM Revenue and Customs’ (HMRC) online service as there are several benefits to completing your 2011 tax return online:
- You have longer to file your return (the deadline is 31 January rather than 31 October)
- The online system automatically calculates any tax payable
- Online returns are processed more quickly
- You will get an acknowledgement that HMRC have received your tax return (you do not receive such an acknowledgement if you submit a paper based tax return)
To submit your tax return online you have to register for the service using the HMRC website.
Three common errors to avoid
Whichever type of tax return you decide to submit, there are some common mistakes that you should avoid:
- Failing to sign and date your paper based return
- Using a previous year’s paper based tax return and simply changing the dates
- Not filling in all additional and supplementary pages (see below)
Make sure you complete all the necessary pages
When completing your tax return, it is important that you make sure to complete all the relevant pages. Your tax return contains a number of ‘core’ pages and a number of supplementary pages. Supplementary pages include:
- Income from property
- Income from pensions
- Capital gains
If you plan to submit your tax return online, you should select the supplementary pages that you need when you head onto the HMRC website to complete your return. For paper based returns, you can download most of the supplementary pages that you may need from the HMRC website.
When completing your tax return, make sure that you have all the relevant records and paperwork to support your return. You have to provide exact figures to HMRC (approximations are not good enough).
Don’t send your tax return late
If you are completing a paper based tax return, the deadline for it to reach HMRC is midnight on the 31st October after the end of the tax year. If you received your notice to file a return late, you have three months after the date of issue of the notice to complete your tax return.
If you are using the HMRC website to submit your tax return electronically, you get an extra three months. You have to submit your tax return by midnight on the 31st January following the end of the tax year.
There is an automatic £100 penalty if you miss this deadline and there may be further penalties depending on how late your tax return is submitted.