1. Registering with HMRC
2. Tax return basics
4. Claiming business expenditure
As the January deadline looms, this guide sets out the basics for getting your tax affairs in order and filling in your self-assessment tax return. The tax penalties have been increased this year, so filing your tax return promptly and getting it right first time is more important than ever. After all, in these difficult times, everyone should be aiming to avoid wasting their hard-earned cash on hefty penalties.
Registering with HM Revenue & Customs
Selecting the right form
If you believe you need to complete a tax return, you must inform HM Revenue & Customs (HMRC). There are a variety of forms to use; selecting the right one will depend on your reasons for needing a return:
• If you’re newly self-employed, use form CWF1
• If you’re becoming a partner in a partnership, use form SA401
• For any other reason, such as you have become a director, you’re likely to need form SA1
Please note that if you’re going self-employed or becoming a partner, you may also need to begin paying Class 2 National Insurance contributions (currently £2.50 a week). Use form CA5601 if you think this applies to you.
Also, if the partnership is newly formed, it will need to be separately registered with HMRC, using form SA400.
Most HMRC registrations can now be done online on their website www.hmrc.gov.uk.
The information required in these forms is fairly straightforward, such as full name, date of birth and address. You will also need your National Insurance number.
If you’re registering as self-employed or as a partner, you will also need to provide details about the business, such as when it started, its address, what industry the business operates in, etc.
If you’re completing the registration process using paper forms, the address that you need to send them to once complete can be found on the form. You should always keep a copy of the form and note the date that you sent it.
HMRC will send you a confirmation of registration and provide you with your unique taxpayer's reference, or UTR. This is a unique reference for your tax affairs. You should quote this on any payments you make or any correspondence to HMRC. They will also ask you for this or your National Insurance number if you ever phone them with a query.