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1,000 is the magic number!

When do you need to submit a tax return? Well in most cases £1k is the magic number ! When your income (excluding employment earnings) goes above £1k you will need to register with HMRC and send in a tax return.

  • Are you a sole trader, running your business and your income (not profit) is over £1k?

  • Do you have a property rental which has income (not profit) of greater than £1k?

  • Do you have a holiday let with income (not profit) greater than £1k?

  • Are you non resident and have property or holiday let income (not profit) greater than £1k?

In all of the examples above you need to declare you income on a tax return. It doesn't always mean you have extra tax to pay as you may have costs to deduct from your income to reduce the profit from the business activity down. If you make losses then they can be carried forward to future year profits, in some cases trading losses (not property) can be used against other income in the current year with some restrictions.

Other times you need to submit your tax return:

  • Dividend income over £2k for the 2022/2023 tax year (£1k for 2023/2024)

  • If your total income (including employment income) is > £100k

  • If you need to report a High Income Child Benefit Charge

What is High Income Child Benefit Charge? You may have to pay the High Income Child Benefit Charge if you or your partner have an individual income that’s over £50,000 and either:

  • you or your partner get Child Benefit

  • someone else gets Child Benefit for a child living with you and they contribute at least an equal amount towards the child’s upkeep

It does not matter if the child living with you is not your own child.

Tax returns are completed for each financial year and submitted before or on 31st January following the end of that tax year. So for 6th April 2022 - 5th April 2023 a tax return will be due on 31st January 2024.

If you are not already registered to complete a tax return and need to for the 2022/2023 tax year then getting our tax reference number (unique tax reference number, UTR) from HMRC will be required and this can take time to come through prior to submitting a return.

There is more than you may think that goes into preparing a tax return, checking for reliefs, checking for unused allowances, ensuring all costs are deducted. Getting an accountant to complete your tax return will mean that you can be sure that all deductions/reliefs have been applied.

Get in touch if you would like to discuss your tax return and enjoy being part of the early bird club to get your return submitted earlier than the 31st January deadline!

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