Why online Tax Returns?

If you only have one job and receive no income from anywhere else you will probably never need to fill out a tax return. If you are required to complete one, the HMRC will normally send you a notice to complete your tax return. It is important to remember that if you realise that you need one and HMRC haven’t notified you then it is your responsibility to ask for it. The main reasons why Self Assessment may apply to you are listed below:

• You’re self employed

• You’re a company director

• You’re a minister of religion

• You have income from letting any property or land you own

• You receive other untaxed income, or significant capital gains, and the tax due on it cannot be collected through a PAYE tax code

• You’re a member of Lloyd’s of London insurance and reinsurance market

• You receive annual income from a trust or settlement, or any income from the estate of a deceased person, and further tax is due on that income

• You have taxable foreign income, even if you are claiming that you are not normally resident in the UK.

Before you start to complete your online tax return you will need to gather all the paperwork you will need. It will be very frustrating to get half way through the form only to realise that you do not have a crucial bit of data. Aside from this, it is actually a legal requirement to keep your paperwork up to date. You must keep records of your income for at least 22 months after the end of the tax year. If you are in business and self-employed as a sole trader or partner, or have rental income you are required to keep records for at least 5 years and 10 months after the end of the tax year. You will need to have the following information to hand when completing your online tax return:

• Your P60

• Details of any pay and taxable expenses and benefits received from your employer

• Bank and building society statements

• Cheque and paying-in book stubs

• Any dividend vouchers you have

• Your self-employment accounts

• Documentation about any capital gains that have been realised

• Information on other income including investments, savings, pensions, property or benefits you receive

• Paperwork on anything you can claim for, like self-employed expenses or charitable donations.

Each year the amount of people choosing to fill in their tax return electronically is increasing and there are many benefits to completing your tax return this way. There is no hassle with paperwork and you do run the risk of it going missing in the post. You will receive and immediate acknowledgement of receipt so you can relax in the knowledge that it has arrived safely. You can also buy yourself an extra 3 months as you have a deadline of January 31st. You can also save the form as you go along meaning that you do not have to complete the whole thing in one sitting. The HMRC will automatically calculate your tax for you and if you are due a refund you are more likely get it quicker as your form will be processed sooner!

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