Breaking Down the Myths of Self Assessment
What You Need to Know for the 2023-2024 Tax Year
As we approach the deadlines for Self Assessment tax returns, Lloyds Accountancy WM Limited is here to ensure you're well-prepared. If you're filing for the first time, you need to notify HM Revenue and Customs (HMRC) by 5 October 2024 to cover the 2023-2024 tax year. The final deadlines for tax returns are 31 October 2024 for paper returns and 31 January 2025 for online submissions.
But who actually needs to file a Self Assessment? Unfortunately, there are many myths that confuse taxpayers every year. Let’s debunk some of the most common ones to make sure you understand your responsibilities and avoid unnecessary penalties.
Myth 1: "HMRC hasn’t been in touch, so I don’t need to file a tax return."
Reality: It’s up to you to determine if you need to file a tax return, even if you haven’t received any communication from HMRC. There are several reasons why you might need to register, such as:
If you are newly self-employed and have earned over £1,000.
If you’ve received untaxed income exceeding £2,500.
You or your partner earn more than £50,000 and receive Child Benefit payments, meaning you may owe the High Income Child Benefit Charge.
Not sure if you need to file? HMRC provides an online tool to check. Once registered, you’ll receive a Unique Taxpayer Reference to use when filing your return.
Myth 2: "I have to pay the tax when I file my return."
Reality: Even if you submit your return early, the payment deadline for tax owed remains 31 January 2025. However, you can choose to ease the financial burden by setting up a Budget Payment Plan, allowing you to spread your tax bill over weekly or monthly payments.
Myth 3: "I don’t owe any tax, so I don’t need to file a return."
Reality: You may still need to file a return even if no tax is due. Filing could allow you to claim a refund or tax relief on items like charitable donations, pension contributions, or business expenses. It’s also important for those who want to make voluntary Class 2 National Insurance Contributions to protect their State Pension entitlement.
Myth 4: "HMRC will remove me from Self Assessment automatically if I don’t need to file anymore."
Reality: Not true. If your circumstances change—such as if you’re no longer self-employed or your income falls below a certain threshold—it’s your responsibility to inform HMRC. Failure to do so could lead to penalties for missing a return, even if you no longer need to submit one.
Myth 5: "HMRC is cracking down on online sellers, and I need to file a return for selling my personal items."
Reality: There’s no need to worry if you’ve sold personal items like clothes or books online. HMRC’s focus is on individuals running businesses via online platforms, not those selling off used items.
Stay Informed and Avoid Mistakes
HMRC offers plenty of resources to help guide you through the Self Assessment process. From YouTube tutorials to tools on GOV.UK, they aim to make tax filing as straightforward as possible. Additionally, be aware of potential scams—never share your login details with anyone, even your tax agent.
At Lloyds Accountancy WM Limited, we recommend filing your return early. This gives you peace of mind, reduces the risk of errors, and provides ample time to explore options like spreading tax payments or claiming refunds.
If you have any questions or need professional assistance, don’t hesitate to reach out to us. We’re here to guide you through every step of your Self Assessment journey.
Contact us today:
Phone: 0345 646 1516
Mobile: 0786 777 0009
Email: info@lloydsaccountancywm.co.uk
Website: www.lloydsaccountancywm.co.uk
Address: NG9 Electra House, Electra Way, Crewe, CW1 6GL
