Are you totally new to taxes, or do you just hate tackling your tax return?
Well, the UK tax system is mind-bogglingly complex, but if you can’t afford a clever accountant, it’s worth getting to grips with the basics, and avoiding a mad scramble to put your affairs in order at the very last minute. Whether you’re self-employed or an employee, read our top ten tax tips – the do’s and don’ts and deadlines, to help you get organised and pay the right amount at the right time, so you avoid any penalties or fines.

1. Do you need to do a Self Assessment tax return?

 
There are many reasons why you might need to complete a tax return, they are not just for the self-employed. If you do need to submit one, bear in mind the deadline is 31st January 2024 for online returns – if you earned any untaxed income between 6 April 2022 – 5 April 2023, you will need to file a return for tax year 2022-23.
 
If you’re self-employed, you need to register with HMRC and complete an annual Self Assessment tax return, whether you are making a profit or loss.
 
If you’re employed, tax is normally deducted automatically from your salary through PAYE (Pay As You Earn scheme). But there are situations where you may also need to file a tax return, if you earn extra income from other sources e.g. freelancing or renting out a room.
 
If you’re unemployed but received income, you may need to pay tax via Self Assessment.
 
If HMRC have sent you a Self Assessment form or a notice to file online, you must submit your return (even if there is no tax to pay), otherwise you could be fined at least £100!
However, if you don’t think you should be doing a tax return (e.g. you pay all your tax through PAYE, or you’re not earning), call HMRC and ask them to cancel it.

Call HMRC: 0300 200 3300

How to check if you need to complete a Self Assessment tax return for this past tax year:

Use this HMRC tool

Call HMRC: 0300 200 3300

Or see our simple guide for the main reasons you might need to file a return

2. Stay informed

 
Make sure you understand your tax responsibilities, key dates and deadlines, and what deductions can be offset against your income (tax reliefs and tax allowances).

3. Don’t miss deadlines

 
Procrastination could be costly! Be aware of deadlines for completing your tax return or paying any tax you owe. Otherwise you could face penalties for a late tax return (£100) and interest on any overdue tax.
 

Key deadlines for this year’s tax returns
(Tax year: 6 April 2022 – 5 April 2023)

Source: Self Assessment tax returns: GOV.UK

Self Assessment payment helpline
: 0300 200 3822
Call HMRC if you have missed your tax payment date
 
 
 

4. Register in good time

 
If you need to file a tax return for the first time, you will have to register with HMRC for Self Assessment. The registration process can take several weeks, so allow plenty of time in order to meet the deadlines for tax returns and payments.
 
 
 

5. Get organised

 
Before you start filling in your tax return, collect all the info you need e.g. your PAYE tax code, P60 or P45 form, employer and pension provider details, tax certificates for dividends and investments.
 
For self-employed, you will need bank statements, invoices, expenses etc. You need to keep accurate records of all income and outgoings for your business.
 
 
 

6. Check your tax code

 
If you are an employee (full-time or part-time), you will have a PAYE tax code. It’s a series of numbers and letters on your payslip, which tells your employer how much tax should be deducted from your pay, before the money even reaches your bank account. e.g. the tax code 1257L indicates you have the standard Personal Allowance, which means you can earn £12,570 of tax-free income.
 
Check you are on the right tax code with MSE’s Tax Code Calculator. If your tax code is wrong, you could be paying too much or too little tax, so you should inform HMRC: It’s generally easiest to resolve the situation by calling their helpline on 0300 200 3300.
Alternatively, you can use HMRC online services
 

Find out more about tax codes at GOV.UK

7. Don’t forget your student loan

 
Once you start earning over the repayment threshold (£27,295 a year if you have a Plan 2 loan, £25,000 if you’re on Plan 5), you will need to start repaying your student loan via the tax system.
 
If you’re in employment, HMRC normally instructs your employer to start deducting repayments directly from your salary, via the PAYE system.
 
If you pay tax through Self Assessment, you must tick the Student Loan box on your tax return. HMRC will calculate the amount to be repaid along with your tax bill.
 
Make sure you keep the Student Loans Company informed of your contact address and employment information, because otherwise they might impose a penalty interest rate for ‘failing to respond to requests for information or “losing touch” with the company.’
You can check your student loan repayments and balance via their website, and you can apply for a refund if you have overpaid.
 
 
 

8. Budget for tax payments

 

If you are using the Self Assessment system, or you owe tax from previous years, the deadline for any tax payments is 31 January.
 
If you’re self-employed, use the HMRC Ready Reckoner tool to estimate your tax and National Insurance bill, and work out how much money to put aside each month, so you have funds available to pay your tax on time.
 
For other taxpayers, estimate your gross income, then use this simple Tax Calculator to work out what you will pay over the year in Income Tax, National Insurance, any pension contributions (if you are enrolled in a workplace pension) and Student Loan repayments; it also estimates your remaining take-home pay.
 
 
 

9. Make sure it’s official

 
If you file your tax return online, make sure you use the official free HMRC site.
Beware of copycat sites who may charge hefty fees for the service!
 
Beware of HMRC phishing and scams: You will never get an email, text or phone call from HMRC, telling you about a tax rebate or penalty (they would notify you by post), or asking for personal or payment details. Don’t give out any private information, nor click on links nor download attachments.

Dealing with HMRC scams – GOV.UK
How to identify and report HMRC phishing & scams

10. Get help & advice

 
These tax tips give general tax information, but you should seek help and advice relevant to your own circumstances.

• Visit the HMRC website or call their helpline on 0300 200 3310

 

• Or see our consolidated list of useful contacts, online resources and tax tools; we have included fee-charging professional tax advisers, but many of the listed sources are free, so do check them out if you’re struggling with tax matters.

Find out more about tax matters:

Income Tax, National Insurance, Student Loan Repayments, and how you pay tax through PAYE or via Self Assessment