Update January 2023: Making Tax Digital MTD for income tax has been delayed by two years until April 2026.
With the 31st October paper return deadline fast approaching, we thought it would be useful to look at the paper return and the other methods you can use to file your Self Assessment tax return.
If you’re new to submitting Self Assessment tax returns, it pays to know that there are three ways of filing. Firstly, you can submit via the HMRC portal and receive instant acknowledgement post-submission. You can also use commercial software to do this for you. Or, you can send a paper tax return to HMRC in the post.
Whichever method you choose, it’s important to understand your exact responsibility. For those who are self-employed or let out UK property, paper submissions can be complicated as they involve additional forms and documentation.
1. Be conscious of the deadline
Should you choose to file a paper tax return, don’t forget to file before the 31st October paper return deadline. Failure to do so will see you start being charged penalties from the 1st November. We would recommend sending your paper submission prior to the October deadline, either through recorded delivery or with some proof of posting in order to prove your compliancy.
You have longer to submit online tax returns. The deadline is the 31st January, and you will be charged penalties from the 1st February for any late submissions.
2. Organise supplementary pages
Remember, it isn’t enough to submit the main SA100 tax return. You need to bundle it together with the rest of your documentation that references your property or self-employment income.
For any income as a landlord, all that’s required is to file an additional form (SA105) and submit it alongside your regular Self Assessment tax return.
However, with self-employment, the additional sections required of you could be either the SA103S or the SA103F. The difference between the two is that the former is for those who had an annual turnover below the VAT threshold for the tax year (£85,000 as of 2020/21), and the latter is for those who earn above the VAT threshold.
3. Be open to online
While you may have historically always submitted your tax return by paper, the vast majority of tax returns are now submitted online. Last year saw only 700,000 paper submissions, for example. Improvements in technology and the extra three months to file are the main incentives to submit an online tax return.
Having an online account with HMRC allows you to not only extend your filing deadline but also check your details at any time to see how much tax is due and act accordingly.
If you’re happy to tweak the way in which you keep your records and adopt digital record-keeping, this will help minimise admin further, as well as enable you to submit your tax returns and automatically calculate your tax.
Lastly, be conscious of MTD for Income Tax now scheduled for April 2024 – whilst this may seem far in the future it will be here before we know it. Adopting a digital approach to filing your Self Assessment now will ease the transition in 2024.
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