The Ultimate Guide to Self-Assessments

It’s that time of year again when we gather to discuss everyone’s favourite topic…self-assessments. 

 

“But guys, the self-assessment deadline for the 2022/23 tax year isn’t until the 31st of January 2024?!”, we hear you already start to procrastinate 😉

 

That is true. That is the ABSOLUTE deadline before you get fined.

 

This is why in this blog, we want to give you the ultimate guide for getting your self-assessment done, whilst also giving you some game-changing reasons why you should get it done early.

 

Let’s get into it…

 

The Ultimate Guide to Self-Assessments

 

What is a self-assessment anyway?🤷

 

A self-assessment is your opportunity to report your income, expenses, and any applicable tax reliefs to HM Revenue and Customs (HMRC). Think of it as your financial Dear Diary for the year and HMRC is your older sibling who is going to read it and use it to their advantage. 

 

We’re kidding, HMRC are lovely…

 

The tax year runs from 6th April one year, to the 5th of April the next. So, for the 2022/23 tax year, it runs from 6th April 2022 to 5th April 2023.

 

Who are self-assessments for?👇

 

Here’s a lovely little screenshot from the HMRC website for you.

 

If you are unsure whether you need to do one, you can either ask us, or there is a way to check on the HMRC website here.

 

What goes into a self-assessment?📋

 

There are two sections to a self-assessment tax return, the main section and the supplementary sections. The main section is the SA100, which deals with:

• Taxed and untaxed income in the form of dividends and interest
• Benefits, including State Pension, Child Benefit and Blind Person’s Allowance
• Charitable donations
• Pension contributions

 

If you have income to declare as any of the following, you’ll have to fill in a supplementary page:

• From self-employment
• Property
• Company director
• Capital Gains 
• From abroad
• Or a foreign national

 

In this section, you should also declare any allowable expenses, which will be deducted from your tax bill.

 

For more information on what expenses are allowable, give us a shout.

 

Okay, now we’ve covered the basics of self-assessments, let’s look at how you can make your life easier when it comes to sorting yours.

 

• Gather Your Documents (And for bonus points, track them throughout the year)📁

 

To tackle your self-assessment successfully, you’ll need to gather the necessary documents. 

 

This will include things like your P60, any relevant receipts, invoices, and bank statements. 

 

If you gather these throughout the year, future you will be a big fan. If you haven’t even thought about it yet, start now so it’s not a last-minute panic.

 

• Review Your Income Sources📈

 

Now you’ve got them all together, take the time to evaluate all of your income sources, including employment, self-employment, rental income, dividends, and interest. Make sure you have all the necessary information, such as pay slips, invoices, and statements, to accurately report your earnings. 

 

This will make your life easier when it comes to completing your self-assessment tax return.

 

• Get those deductible expenses in👌

 

This is where the sweetness of tax relief comes in!

 

Allowable expenses include things like business costs, professional subscriptions, travel expenses, and charitable donations. 

 

Keep track of your receipts and make a note of each expense’s purpose and relevance to your work or business. This will ensure you don’t miss out on potential tax savings and who doesn’t want those?

 

• Check for Tax Reliefs and Allowances👍

 

Don’t forget to explore available tax reliefs and allowances as these can significantly reduce your tax liability. 

 

Examples include: 

 

• The Marriage Allowance
• The Personal Savings Allowance
• The Annual Investment Allowance. 

 

Researching and understanding these opportunities can save you money and make the self-assessment process more rewarding. 

 

• Use Online Tools 🖥️

 

HMRC provides online tools and resources to simplify the self-assessment process. Consider using their Self-Assessment Online service or reputable tax software to complete your return accurately. 

 

These tools often provide step-by-step guidance and calculations, reducing the chances of errors and ensuring compliance with tax regulations. 

 

• Bring in the big guns💪

 

If the self-assessment process feels overwhelming (we get it) or you have complex financial circumstances, don’t hesitate to seek professional help. 

 

An experienced accountant can provide personalised advice, ensure accurate reporting, and help you identify additional tax-saving opportunities. Their expertise can save you time and could reduce your tax bill. 

 

And luckily for you, we know a good one 👀

 

So, that’s the basics of a self-assessment covered, alongside the best ways to complete a return. Now, here are the benefits of doing it early…🤩

 

• Less stress – December and January are mental enough without throwing a self-assessment into the mix. Get it done early and feel super smug later when other people are flapping.
• More cost-effective – By doing it early, you’ll know what you owe sooner (if you do owe anything). That way, you can plan your budgeting for the year and pay your tax bill in instalments if you need to – You can also get help if you find you can’t pay.
• You could get paid quicker – On the flip side, you can find out sooner if you’re owed a refund – and you’ll get it sooner too. That would be a sweet way to end the year.
• More chance of getting support – If you’re doing it yourself then HMRC phone lines get horribly busy in the run-up to the self-assessment deadline in January. And if you want to use an accountant, they will not appreciate you leaving it until the last minute and may charge you an additional fee for doing so.
• Your accountant will be your best mate – Speaking of accountants, yours will love you very much for getting it done early. Make your accountants’ Christmas by not making them have to work because you are so organised and wonderful.

 

There you have it – The Ultimate Self-Assessment Guide.

 

If you have any questions about any of this, give us a shout. We’d be happy to help so long as you haven’t left it too late 😉

 

In the meantime, here’s something for you…👇

 

• Get the latest finance tips, business hacks, free resources, hilarity, memes and more by joining our monthly newsletter, ‘Sumthing To Say’ here.
• Do you need your accounts taken care of for you? You can Book a Discovery Call here.

 

Take it easy.

Al and Led