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Self-assessment describes how all individuals report their taxable income and expenses to HMRC, including income from a self-employed business, partnerships (apart from limited partnerships) and income from renting out property.
Self-assessment software is any software that records taxable transactions and/or analyses the transactions to calculate an individual's tax return. Some self-assessment software can also create the final tax return and even submit it electronically to HMRC.
Good self-assessment software helps you avoid underpaying tax or unnecessary fines. It also automates everyday financial tasks and enables collaborating with an accountant.
There are several self-assessment deadlines to be aware of:
Depending on the type of income and expenses you need to declare you may need to complete a number of different self assessment forms including the SA103 for your income from self-employment and SA105 for your income from any property.
Once you have completed all the necessary forms it is summarised onto the main self assessment form (SA100).
Some data such as income from the sale of your house must be submitted much earlier than other data (for example your share of any partnership profit or loss).
Each type of tax information has its own rules about when it must be submitted, if you are unsure then you should ask HMRC or an accountant
Additionally, there’s a separate deadline if you wish to fill in your self-assessment form manually and post it to HMRC.
Check these deadlines each year at HMRC’s website. If you miss any, you will be automatically fined.
Registration deadlines
If you haven’t already registered for self-assessment then you need to do so as soon as possible (you only need to register if it’s the first time you’re making a submission). The basic principle is you must notify HMRC that you are chargeable for income tax within six months from the end of the first tax year for which you are chargeable for tax.
Whatever the case, HMRC’s guidelines say you must register no later than the following:
If you aren’t registered after these dates then you might be penalised.
The steps for registering for self-assessment are as follows:
HMRC expects you to file online and, within a few years, it’s likely to be the only way you can complete a self-assessment tax return. If you haven't completed a tax return online before, register for an HMRC online account.
When you have signed up, HMRC will post an activation code. According to gov.uk (https://www.gov.uk/pay-self-assessment-tax-bill/bank-details), this can take ten working days to arrive – or up to 21 days if you are abroad. You will also receive a user ID and Unique Taxpayer Reference (UTR). It's also typically found on your HMRC online account or paying-in-slip.
Now, you can pay a self-assessment tax turn by making a bank transfer from your bank account to HMRC. Faster Payments, Chaps and Bacs is supported. You’ll need to include your 11-character payment reference before paying.
Our guide to filing a self-assessment return covers the process in more detail: https://www.sage.com/en-gb/blog/file-a-tax-return-online/
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