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Self-assessment tax return

Self-assessment tax

By Ian Robinson

Article 3 of 10

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Self-assessment tax

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
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