Self – Assessment Tax Return – Easy Guide, Part 3

Online tax returns

Filing your tax return online is fairly straightforward and has several advantages, but you will need to plan ahead in order to complete the form on time.

There are many reasons to file your tax return online if you are able to do so. You can tailor the return and just complete the pages you need, plus you get online help as you work through the form. Your tax is calculated automatically and you get an acknowledgement when HMRC receives your return. You have longer to complete the online return than if you use a paper form: until 31 January following the end of the tax year instead of 31 October.

If you’re filing online for the first time, follow these steps so that you are ready to submit your return successfully:

1. Check your 10-digit Unique Taxpayer

   Reference. HMRC should have issued you with this code, which is known as a Unique Taxpayer Reference (UTR), and it will appear on some of your paperwork from the authorities. If you don’t know your UTR, contact the telephone help line and ask to have it sent by post to your home address. HMRC can’t confirm the reference over the phone. You will also need your National Insurance number or postcode to confirm your UTR.

2. Register to use HMRC Online Services.

   Log on to the registration page of the HMRC website at online.hmrc.gov.uk/ registration/individual and select ‘Self Assessment’.

3. Set up an online account.

   You will need to create a password and to receive a user ID, which will be sent to you online. Make sure you keep a note of this ID, as you will need it to log in. If you forget the ID, you can get HMRC to send it again by email or post. It can also issue a replacement password if you forget this.

4. Wait to receive an activation code by post.

   This is similar to the security code issued by credit card providers. It takes about a week to arrive, so make sure you apply in plenty of time to wait for the code to arrive and for you to be able to complete your return.

5. Log on and activate your account.

   You must do this within 28 days of receipt, or the code will expire and you’ll have to request another one. Once you’ve completed these steps and assembled your documentation (see page 7), you are ready to begin filing your tax return online. If you have registered for online filing in a previous tax year but have mislaid your password or user ID, you do not need to start the process all over again. It is possible to get an online reminder via HMRC’s online services login page (online.hmrc.gov.uk/login), though you will have to answer a number of security questions to access the information.

Commercial software options

HMRC’s online service enables you to file your self-assessment free of charge, but a number of commercial software providers sell products for filing returns. The HMRC service only covers the income and gains from these sources:

• Employment;
• Self-employment;
• Partnership – to report the income you receive as a partner;
• UK property;
• Capital gains;
• Foreign.

If you have other income to report – for example, you need to send a Trust and Estates tax return – you may need to use commercial software, and some people may prefer to do so in any case. HMRC maintains a list of providers it has successfully worked with in the past but cannot endorse them.

Note that even if you are using commercial software, you will still need to sign up for HMRC Online Services before you can send your return online.

Find out more: 

HMRC’s website: hmrc.gov.uk