The Process
Self Assessment is how you tell HMRC about your income if it’s not taxed automatically. This is common for self-employed people, company directors, or anyone earning money outside a normal salary.
Who Needs to Do It?
You need to complete a Self Assessment if you earn more than £1,000 of income:
● Money from freelancing or running your own business
● Rental income from property
● Dividends, interest, or other investments
● Foreign income or certain benefits
● Or if you’re a director or high earner claiming tax reliefs
How It Works
Each year, you report your income and expenses through a tax return. HMRC calculates your tax, or you can do it yourself.
Online tax returns are due 31 January, and paper returns by 31 October.
Filing on time avoids penalties and ensures you only pay the tax you owe.
MTD (Making Tax Digital)
HMRC have started rolling out MTD to individuals and landlords who earns £50,000 or more since April 2026. Next year, this threshold reduces to £30,000.
If you fall into this category, you will need to report your Income and expenditure from your business every three months.
It is highly advisable to find an accountant to support you with this transition.
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