Who Should Use The Self Assessment Tax Return Form In the United Kingdom
Anyone in business in the UK who isn’t integrated into a limited company must complete a self assessment tax return form for their financial affairs every year.
Fоr each year in question thе sресіfіс tах rеturn tо bе соmрlеtеd bу еvеrуоnе who is sеlfеmрlоуеd.
Тhе nеw self assessment tax return form was іntrоduсеd to help move thе rероrtіng рrосеdurе online thе еnd оf thе fіnаnсіаl уеаr.
This shouldn’t be an issue to those familiar with the prior small business tax return as the format is similar and presented in a simpler approach to facilitate better understanding and accurate completion.
Self-employed businesses aren’t required to keep formal accounts of the year’s financial transactions but must keep sufficient financial records to justify and support the financial entries made on the tax returns.
While formal financial accounts may not be essential requirements, an organized method of record keeping using bookkeeping or accounting applications is highly desirable to maintain financial control.
The accounting system employed can be simple lists of fiscal records supported by sales invoices, purchase invoices and where applicable money or bank records.
The important support to all bookkeeping procedures is third-party documents received or issued to offer a full and fair financial account of the enterprise.
There are some rules to be taken account of as to whether the full version of the tax return should be completed or if the short version is applicable.
Most small companies with an annual turnover under 64,000 pounds would finish the brief tax return. However, there are certain exclusions where the complete return must be completed.
The self-employment (full) tax return is required to be completed when the following conditions apply, and the self-employment (brief) tax return is required where the terms do not apply:
1. Sales turnover exceeds a certain amount during the fiscal year or exceeds an average each month if trading for less than a full financial year.
2. The accounting date to which accounts are made up has changed in the last financial year.
3. The accounts have been declared in a previous tax return.
4. The basis on which the accounts are prepared has changed from a cash accounts basis an accruals basis.
5. The self-employment involves the provision of contracts that continue in the next financial year.