Self Assessment is how HMRC collects Income Tax from people whose income isn't taxed automatically through PAYE — most commonly, the self-employed. If this is new to you, here's what it actually involves.
What is Self Assessment?
It's the process of reporting your income and expenses to HMRC once a year, so your tax bill can be calculated. Rather than tax being deducted automatically from a payslip, you work out and pay it yourself, based on your business's profit.
Who needs to file?
You'll typically need to complete a Self Assessment return if you're self-employed and your income was above a certain threshold, if you're a company director, if you have significant income from property or investments, or if HMRC has specifically asked you to file.
What records do you need?
You'll need a record of your business income and your allowable expenses for the tax year (6 April to 5 April), along with details of any other income — such as employment, property, or savings interest — that also needs to be reported.
Filing and payment deadlines
The tax year ends on 5 April. The deadline for filing your online return, and paying any tax owed, is 31 January the following year. Many people also make a “payment on account” toward the next year's tax bill at the same time, and again by 31 July.
Missing these deadlines can result in automatic penalties, even if you don't owe much tax — so it's worth knowing the dates well in advance rather than discovering them in a rush.
Making Tax Digital for Income Tax
Making Tax Digital for Income Tax applies in stages to qualifying sole traders and landlords based on gross qualifying income from self-employment and property. The requirements began from April 2026 for qualifying income over £50,000, extend from April 2027 for qualifying income over £30,000, and from April 2028 for qualifying income over £20,000. Current HMRC guidance must be checked before publication or future updates.
Making the process easier
The parts of Self Assessment that cause the most stress are almost always avoidable: missing records, last-minute scrambling, and not knowing what you owe until the deadline is close. Keeping things up to date throughout the year turns January from a fire drill into a formality.