If you started on the road to self-employment or took on a second job in the last two years, you may need to register for self-assessment by the end of this week.
You have until midnight on Friday, 5 October, to register for self-assessment if you received income in 2018/19 that wasn’t taxed at source.
More specifically, if you earnt more than £1,000 between 6 April 2018 and 5 April 2019, or have any other untaxed income from this period, you need to register.
Untaxed income includes savings or investments, dividends, tips and commission, the proceeds from renting out a property, and any foreign income.
Registering for self-assessment is essential to declare this untaxed income to HMRC, and to pay income tax and national insurance contributions (NICs).
The Office for National Statistics estimated around 160,000 people became self-employed last year, most of whom will be going through this for the first time.
Details needed to register
The most common way to register for self-assessment is online, although you can register over the phone or by post – allow enough time for the latter.
Make sure you have your national insurance number to hand. This consists of two letters followed by six numbers and a final letter.
That may sound like you’re giving Rachel Riley instructions on Countdown, but a mistake this late is day could cost you down the line.
Then you need your personal and business details to hand and you should be ready to go.
What happens next?
HMRC will provide you with a unique 10-digit taxpayer reference (UTR) number, which you should receive through the post sometime next week.
Make a note of your UTR number so that it’s easily accessible. You will need this to register for all of HMRC’s online services including submitting your tax return.
Once you’ve done this, a PIN number will be the next thing HMRC sends you and this enables you to activate the Revenue’s online services.
The good news in all this is that once you’ve registered with HMRC, you will not need to register again.
Gather your records
One of the best bits of free advice we can give you when it comes to filing an accurate tax return for the first time is to keep comprehensive records.
This could be evidence of self-employed income or salary from employment, dividends or partnership income depending on your business structure.
Interest, rental income or foreign income, pension contributions or income from a pension, and gains from the sale of an asset, should also be recorded.
It’s important to get into the habit of keeping records now, as the Revenue can call on you to produce records dating back six years if you’re under investigation.
Need a helping hand?
Getting started with self-assessment can be a stressful experience and the easiest way to reduce the pressure is to seek specialist advice.
We’re happy to process your personal tax or company tax return ahead of the filing and payment deadline at midnight on 31 January 2020.
To find out more about how we can support you, get in touch by calling 01454 619900 or emailing us at advice@dunkleys.accountants