If you’re self-employed or a company director, you must fill in an annual self-assessment form. If you’re submitting your return online, don’t leave things until the last minute, as you won’t be able to do so without an activation code.
Self-assessment in a nutshell
If you’re a sole trader, or trade via a self-employed partnership, you calculate how much tax you owe via the self-assessment process each year. All company directors, regardless of how much income they earn, must also submit a tax return each year.
You can either fill in a paper return (the deadline is 31st October), or submit your return online (the deadline is 31st January). In both cases, the deadline for actually paying any tax you owe is 31st January.
If you’re as little as one day late, you will have to pay an instant £100 penalty, with further penalties to pay if your return remains outstanding.
The majority of taxpayers opt to file online – but to do this you need to be registered for HMRC Online Services – something many people forget until the last minute. The registration itself is simple, but you must then wait for an ‘activation code’ to arrive via the post before you can get online and complete your tax return.
How to register for HMRC Online Services
If you’re an individual taxpayer (limited company director), simply click here to begin the registration process.
If you’re a sole trader (self-employed), or a work within a partnership, use the organisation registration page.
Even if you’re not running your own business, you may still have to complete a return if you received income in the previous tax year which has not yet been taxed (this includes people who have been hit by the controversial child benefit tax charge).
Before you start, make sure you have your Unique Taxpayer Reference (UTR), which you will have received when you initially registered for self-assessment, and your National Insurance (NI) number or postcode.
Once you’ve entered your email and password, you will receive a Government Gateway ID.
Once you’ve entered your UTR, plus NI number or postcode, the all-important activation code will be sent to your home address.
What happens next?
Once you’ve received the activation code, you can log on to HMRC Online Services to complete your self-assessment form, and view past and future tax statements, and other services.
You must use the code within 28 days, otherwise you’ll have to re-apply for a new one.
HMRC advises that it can take up to 7 working days to receive the code, and up to 21 days if you’re living abroad.
A number of software providers can submit your tax return on your behalf (Sage, FreeAgent, etc.), however you still have to be registered with HMRC Online Services.