A Quick Guide to Tax Returns for the Self-Employed
Online GST Return Tax returns have to be filled in my thousands of people every year. However, if you are new to tax returns either because you have just become self-employed or you have started earning an additional income, you may be slightly mystified by them. Here is a quick guide to clear a few things up.
What are Tax Returns?
A tax return is a report in which you enter details of your taxable income for the entire fiscal year, which runs from April 6th to April 5th. Using the information that you provide in the report, HMRC will then work out how much you own in taxes.
Tax returns can be either paper documents that you fill in by hand or electrical documents that you fill in online.
Do You Need to Complete a Tax Return?
If you are self-employed you will be issued a return by HMRC in order to fill out details of your income. Additionally, if you have another source of income on top of your job, such as rental income, you will need to file returns each year.
Keep Track of All Activity
Tax returns will ask for details of all of your earnings and your expenditure, so it is very important that you keep detailed records of all of your financial activity throughout the year.
This includes invoices for any work that you are contracted to perform, receipts for any expenses and details of interest earned on your savings.
Online or Paper Tax Returns
You can choose to complete your documents online or in a physical document, so you can choose the most convenient option for you. However, it is important to remember that the filing dates are different for each type of return.
Paper returns have to be returned by the end of October following the end of the taxable year in April, whereas online returns must be filed by the end of January. If you send in your return late you may be fined, so it is important to remember to get it completed early.
Get Help with Your Tax Return
Tax returns can be complicated sometimes, especially if your financial affairs are complex. In this case, you may want to get help filing your returns each year. If so, make sure that you hire an accountant who is experienced in filing tax returns. They will then simply ask you for all of your financial information and will be able to take care of your tax returns for you each year.
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