Self-assessment tax return
By Ian Robinson
Article 3 of 10
Find out whether or not you need to fill out a self-assessment tax return in 2017-18
While the majority of income tax is collected via PAYE, around 10 million people each year make a self-assessment tax return and pay tax in two large sums, rather than monthly instalments.
This guide explains who needs to pay tax this way and what you need to do.
- Get a head start on your 2016-17 tax return with the Which? tax calculator. Tot up your tax bill, get tips on where to save and submit your return direct to HMRC with Which?.
Who pays self-assessment tax?
Self-assessment is used to collect tax from the self-employed, paying income tax on their profits. It is also used if you’re a business partner or a director of a limited company. You'll also need to fill in a tax return if:
- you're an employee or pensioner with an annual income of £100,000 or more
- you have a pre-tax investment income of £10,000 or more
- you're a 'name' at the Lloyd's of London insurance market
- you're a minister of religion
- you're a trustee or representative of someone who has died.
You'll usually also be sent a tax return if:
- you have untaxed income – from investment, land or property, or from overseas
- you make capital gains above the annual exempt amount (£11,300 for 2017-18)
- you were required to fill in a tax return last year
- you're a pensioner who gets reduced age-related allowance, though you may be sent a special short version that requires fewer details.
Use the Which? online tax calculator : our easy-to-use and jargon-free tax calculator offers personalised tax tips, and you can submit the form directly to HMRC.
PAYE and self-assessment
It is possible to pay tax via PAYE and also complete a self-assessment tax return. This is common if you receive a private pension and also if you receive investment income.
If you are an employee but also self-employed (running a business part-time) you might also be required make a self-assessment tax return. You are expected to show details of your employment, earnings and tax deducted via PAYE.
- Last updated: April 2017
- Updated by: Gareth Shaw