If you are self employed, you probably already know that you are required by law to complete a tax return on a yearly basis. However, HMRC may also require the completion of a tax return from individuals who are not self employed.By law, you MUST complete a tax return and pay any income tax and any additional national insurance contributions that may become due if you are:
- A sole trader
- A partner in a business partnership
- A company director (unless it's for a non-profit organisation (like a charity) and do not receive income or payment for expenses (like a company car or travel expenses)
- Receiving any income on top of your main occupation that you should be declaring
- Leaving the UK permanently (until at least the remainder of the tax year) and still drawing an income from the UK (from property, investments, etc.)
Only by preparing a tax return can you inform the government of the amount of your tax liability (the amount you are due to pay), or in the case of some of our customers, the amount of income tax you may have overpaid in the course of the year and that could be reclaimed via a tax rebate.
Could I be entitled to a tax refund after submitting a tax return?
The answer depends entirely on your personal circumstances. In general, if you are a sole trader, a partner in a business partnership or a company director, you would normally not be eligible to receive a tax rebate because you owe tax. However, you may qualify for a tax refund if:
- You work within the Construction Industry Scheme and have paid income tax through monthly tax deductions
- You have left the country
- You have paid tax on account and your business has closed down in the current tax year
Your earnings, income sources and the tax you already paid in the tax year will be crucial in determining whether you are due a tax refund or whether you are due to make additional income tax payments.
Because we're seasoned accountants, we can help you work out your tax liability and apply for a tax rebate on your behalf if it turns out that you paid too much tax in the year (or previous years).
I am leaving the UK permanently, do I need to complete a completing a tax return?
A broad answer is no, you don't, unless you receive an income from the UK while living overseas (this could be income from renting out a property or from investments, for example).
However - and this is important - you MUST inform HMRC that you will not be residing in the UK anymore. This is because HMRC will need to assess your tax position for the year and decide whether you paid too much income tax (in which case you could be due a tax rebate) or not enough (in which case, you will owe HMRC additional payments). In some cases, they may request that you fill in a tax return (for example you emigrate overseas to work for a UK-based employer)
If you are in the process of leaving the UK permanently (or if you left recently), contact TaxDay's accountants without delay so we can assist you in putting your tax affairs in order.