How to Do the Income Tax Return Form for Self Employed Individuals
July 22, 2017
Being self-employed is considered an easy way to start a business, in which both ownership and control of the company fall into one person.
The first thing you should do is tell HM Revenue & Customs that you are starting a new business. This must be done within six months of the end of the fiscal year in which it begins as an independent.
In the UK the financial year begins on April 6 and ends on April 5 of the following year, which is why it must be registered before October 5 of the year following the beginning of its activity as an independent. You can not register before you start your independent activity.
A self-employed worker is responsible for paying his own social security contributions and taxes to HMRC.
You can also register by telephone: 0300 200 3504 from Monday to Friday from 8.00 to 20.00 and on Saturdays from 08.00 to 16.00.
You can also create an account (Government Gateway account) http://www.gateway.gov.uk, which will allow you to communicate online with the HMRC and access the services it provides, such as filing your income tax return form or self assessment.
Once registered you are sent a UTR (Unique Tax Payer), is a number that must be recorded when you have to make a tax return.
What Do You Need to Do?
In order to make the tax return, you must keep a record of income and expenses of the business without having to send them along with your statement, unless the HMRC so requests if you must keep the invoices.
One suggestion to facilitate this activity is to have a single and separate bank account where only entries and exits of money that are related to the activity carried out by the company are reflected, thus excluding some other amount that is not deductible.
There is a system called Self Assessment Online, which is a free system through which you can file the tax return directly online.
In order for the system to allow you to access this application you must register through the HMRC link. Then the system will give you a password and the user ID, finally to the Complete the process send you an activation code by mail which will arrive in approximately 7 days.
This activation code has a duration of 28 days therefore you must activate your account before it expires.
How to pay taxes
Using the Self Assessment online service you can pay the Income Tax and national insurance contributions, the latter can be paid from the moment you registered as a self-employed.
To find out how much you are going to pay taxes you can check online through the HMRC page and then pay by phone, transfer, mail or online.
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