The process of filing your self-assessment tax return online may appear like a daunting job but it doesn’t need to be. If you’re self-employed, a freelancer, or just have to file your taxes online, the process is made it easier, quicker and effective.
Why Should You File Your Self-Assessment Tax Return Online?
The Self-Assessment tax form you can file online has numerous advantages over filing on paper. It’s not just faster however, it also enables you to receive an instant confirmation when your tax return is successfully filed. In addition, online filing can reduce errors since the system will automatically examine for errors and give warnings in the event of something being incorrect. Also, you can enjoy the ease of logging in anytime, which allows you to fill out your tax return as you please.
Step 1: Gather Your Financial Information
Prior to completing your Self-Assessment tax return on the internet it’s crucial to gather all the required documents. This will ensure that you are able to accurately record your earnings and expenses. The most important documents you’ll require are:
- Income records: These include pay slips and invoices as well as any other documentation pertaining to your earnings, if you’re self-employed or freelance.
- Bank statements: They will help you keep track of your earnings from business or other income sources.
- P60/P45 Formulas: When you’re working, the forms will detail your earnings and taxes that you’ve paid.
- Receipts and invoices: If you are self-employed it is important to keep the receipts from business expenditures because they are able to count towards your tax-deductible income.
- HMRC Reference Number: You’ll require this number to log into your Self-Assessment online account.
A complete set of documents at ready will make filling out your tax return easier and efficient.
Step 2: Register for Self-Assessment (If You Haven’t Already)
If you’ve never submitted Tax returns for self-assessment prior to now, you’ll need to sign up with HMRC (Her Majesty’s Revenue and Customs). The registration process is online and, once completed you’ll receive a Unique Taxpayer Reference (UTR) number. This is your ID for any future tax-related actions. Also, you’ll need to establish an online account in order to access your Self-Assessment tax return.
If you’re registered already with HMRC then you’re able to bypass this process and go to the next step.
Step 3: Login to the HMRC Online Account. HMRC Online Account
Once you’ve been registered, you’ll be able to login to your web-based HMRC account. Visit the Self-Assessment online and click the link to fill out the tax returns. If it’s the first time you’re using the online tax system you might require verification of your identity, and then set up security procedures (such as when you receive a verification code via email or text message).
Signing into your online account will be the initial step towards beginning the Self-Assessment Tax Return online.
Step 4: Fill Out the Self-Assessment Tax Return Form
If you fill out your Self-Assessment tax return on the internet, you’ll need to give details of your earnings, expenses and any deductions that you may be eligible for. This is a list of the information you’ll need to fill in:
- Personal Information: The information you provide includes your name, address along with your National Insurance number.
- Income section: Then, provide details for all of the sources of income you earn. This can include income from self-employment, work dividends, savings and any other income that is tax-deductible.
- Expenses (For Self-employed): If you’re self-employed or freelance can declare business expenses. This can include expenses like office supplies as well as travel expenses and other expenses associated with managing your company. Keep detailed records so that you don’t overlook any enumerable deductions.
- Allowable deductions and Tax Relief: It includes things such as pension contributions, charitable donations, as well as other eligible tax reliefs which can lower the tax burden.
- Tax Calculation: After you’ve entered all of your information it will calculate the tax due using the data you’ve entered. It’s crucial to double-check your calculations and make sure everything appears right.
Step 5: Double-Check Your Information
Before you file your Self-Assessment tax returns online, make sure you take the time to go through all of the data you’ve entered. It’s easy to make errors especially for financial data. Common mistakes include not reporting income, not including deductions, or failing to enter the proper tax codes.
Many tax systems on the internet such as HMRC’s have built-in checks which will notify you if something is not correct or is missing. Make use of these tools to make sure your tax return is complete.
Step 6: Submit Your Self-Assessment Tax Return Online
Once you’ve re-read all of the information you have and are certain that it’s accurate, it’s the time to file your Self-Assessment Tax Return online. If you file via the web, HMRC will send you an instant confirmation that the tax return you filed has been accepted. It is important to keep a copy of the confirmation for your own documentation.
If you have any outstanding taxes if you owe taxes, you can pay them directly on the internet by using a variety of payment methods that include debit or credit card transactions, bank transfers as well as other payment options.
Step 7: Keep Your Records
After you’ve submitted your Self-Assessment Tax return online, it’s crucial to save a copy of the tax return along with the supporting documents for a minimum of two years (if your self-employed) in the event that HMRC needs more details. Although this process is done online but the necessity of precise record-keeping is still vital.
Final Thoughts
Making your self-assessment tax return online isn’t necessarily difficult. If you follow these steps, gathering all the required documents, and taking the time to complete the form correctly to ensure that your tax returns are properly filed as well as on time. Online filing provides a quick efficient, secure, and reliable method of completing the Self-Assessment tax form which allows you to focus on your job while remaining on top of HMRC rules.