Most people in the UK pay all their tax ‘at source’, for example, through Pay As You Earn (PAYE) if they are employed, and are not required to file a tax return.
So self assessment does not affect everyone and you will normally only need to complete a form if one or more of the following apply to you:
• You are working for yourself – you are self-employed;
• You are a partner in a partnership business;
• You are a company director, except for directors of not-for-profit organisations who receive no pay;
• You are a minister of religion – any faith or denomination;
• You are a trustee or the executor of an estate.
You also might need to complete a self assessment tax return if:
• You have untaxed income. This could be, for example, interest that is not taxed before it is paid to you or rental income. If you are an employee or a pensioner and the income is less than £2,500 a year you might not have to complete a tax return. But if you receive other untaxed income and the tax due on it cannot be collected via your PAYE coding notice you will need to complete a tax return;
• You receive regular annual income from a trust or settlement, or you receive income from the estate of a deceased person and further tax is due;•You have taxable foreign income whether or not you are resident in the UK. This includes non-UK resident landlords. You can find out more on the GOV.UK website;
• You have income from savings and investments of £10,000 or more before tax;
• You or your partner receive child benefit and your income is over £50,000. This is because of the high income child benefit charge;
• You have capital gains where:
> You have given away or sold assets worth £45,200 or more for 2017/18; or
> You have a capital loss but your gains net of any losses are more than the annual exemption for 2017/18 of £11,300; or
> You have no losses to claim but your gains are more than the annual exemption for 2017/18 of £11,300.
HMRC may also want you to complete a return for other reasons.
Note that if HMRC have sent you a tax return or a notice to complete one, then you must fill it in and return it by the due date unless there is a good reason you do not need to be in self assessment and HMRC agree to cancel it.