When I logged in to the tax office’s website recently, I was met with the headline, “Nearly 300,000 customers file their Self-Assessment tax return for the 2024 to 2025 tax year at earliest opportunity”.
Leaving aside HMRC’s obsession with calling taxpayers customers, I was intrigued, so I read on and discovered that 299,419 taxpayers had filed their SA tax returns in the first week of the new tax year, almost 10 months ahead of the deadline. This was a new record for HMRC, with 57,815 of these ultra efficient individuals amazingly filing on day one of the tax year, a Sunday would you believe.
Why file so early?
Leaving aside those unfortunate individuals with OCD, the bulk of the early filers are taxpayers who had overpaid their tax for a variety of reasons, the main ones being:
- being overtaxed in PAYE because of tax code errors
- to claim tax relief for using your own money for things that you must buy for your job such as the cost of working from home, work clothing and tools. cleaning your uniform, professional fees and subscriptions, travel and overnight expenses to name but a few
- for the self-employed, setting losses against the previous year’s tax-paid profits, reclaiming a payment-on-account made on 31st January and/or claiming for tax deducted as part of the Construction-Industry-Scheme (CIS)
The above list is not meant to be exhaustive but does cover the main areas that might give rise to a refund of tax; additionally, some people just want to know as soon as possible, the amount of tax payable 10 months later on 31st January 2026, so they can sort out their finances at the earliest possible date.
Who must complete a tax return?
The list below has been extracted from HMRC’s website, which states that you must send a tax return if, in the last tax year, any of the following applied:
- you were self-employed as a ‘sole trader’ and earned more than £1,000 (before taking off anything you can claim tax relief on)
- you were a partner in a business partnership
- you had to pay Capital Gains Tax when you sold or ‘disposed of’ something that increased in value
- you had to pay the High-Income Child Benefit Charge
You may also need to send a tax return if you have any:
- untaxed income, such as money from renting out a property
- tips and commission income
- interest on savings
- income from investments, dividends and income from abroad
- you are a director of a limited company
- if you earn over £150,000 in a tax year, unless all of your income is taxed through PAYE
Additionally, you may need to complete a tax return to prove you’re self-employed, for example to claim Tax-Free Childcare or Maternity Allowance pay, or if you wish to pay any voluntary National Insurance contributions if, for example, you don’t have enough qualifying years for a full state pension.
The above lists cover the main reasons why someone needs to complete a tax return, but it does not cover absolutely everything. So, if you’re still not sure if you need to submit a tax return, please contact me by providing details of your circumstance in the ‘Leave a Reply’ box below and I’ll be glad to help.
Accountant’s view
Today I have covered the main reason why an individual may need to complete a SA tax return, with many of you, especially those with relatively simple tax affairs, perfectly able to do it yourselves. However, for those who can’t, or have more complicated personal circumstances, I would suggest approaching a local accountant.
Finally, do not forget about Making Tax Digital (MTD) as a high proportion of you who will need to complete a tax return, might also be caught up in MTD within 3 years, which means that you’ll need to complete four quarterly tax returns, in addition to your annual SA Return, due by 31st January each year.
If you’re not sure if you need to complete a tax submission to HMRC, most tax professionals, such as at my practice, MJ&Co, will not charge for an initial interview, so ask first before making an appointment. At this practice we will tell you if you need to complete a tax return and what it will cost for a qualified tax professional to assist you, which could well be lower than you might imagine.
