Self Assessment - do I need to do one

Bewbie

Hi there, I wondered if some one could offer some help and advice.

I am a PAYE 40% tax payer but have never been asked to fill in a self assessement, I have been in the 40% bracket for 3 years and every time I see an article about tax (usually around this time of year) it always says that 40% tax payers fill in self assessements - is this still true.

Thanks very much in advance for any replies

lcharm

If you are earning money on anything outside of your PAYE, i.e. deposit accounts and certain investments, then they only deduct 20% at the source on any interest you have earned (10% on share dividends). So by law you need to complete a self assessment for the additional 20% that you owe HMRC (22.5% for share dividends etc...). If you are also renting property or earning any sort of passive income then you also need to pay your 40% through self assessment.

I'm sure there will be some other people here who can exlpain it better

Mikeyorks

Bewbie wrote: »

is this still true.

No. The days when 40% equalled automatic enrolment to SA are long gone. The basic test now is that you will stay out of SA if your affairs are relatively simple. And HMRC make that test.

But if you receive interest from Banks etc - then you need to so advise HMRC, as there will likely be additional liability due. But they are just as likely to handle that via P810 procedure (a simple 1 page form and probably only issued every 3 years) and code out any underpayment .. as enrol you in SA.