Tax Return Explained
The form you file with HMRC to declare your income and calculate the tax you owe. The deadline for online returns is 31 January following the end of the tax year.
What is Tax Return?
A tax return (officially a Self Assessment return) is how you report your income and gains to HMRC each year. It includes sections for employment income, self-employment profits, rental income, dividends, savings interest, capital gains and foreign income. You can file online through HMRC's Government Gateway or use commercial software.
How it works
The return covers one tax year (6 April to 5 April). For the 2025-26 tax year, the online filing deadline is 31 January 2027, with tax also due by this date. If you file late, there is an automatic £100 penalty even if you owe no tax. After 3 months, daily penalties of £10 apply for up to 90 days. Payments on account (advance payments for next year) are due on 31 January and 31 July, each being 50% of the previous year's tax bill.
Real example
Phil is self-employed with £35,000 profit and has £3,000 in savings interest. He completes his tax return for 2025-26. His Income Tax is £4,486 on self-employment plus £600 on savings above the £1,000 Personal Savings Allowance. After deducting payments on account already made (£2,500), he pays the remaining £2,586 by 31 January 2027. HMRC also sets his 2026-27 payments on account at £2,543 each (50% of this year's total).
Who does this affect?
Self-employed people, landlords, higher earners (over £150,000), company directors, people with untaxed income, and anyone HMRC has asked to file. Around 12 million people file Self Assessment returns each year. If all your tax is deducted through PAYE and you have no other income, you do not normally need to file a return.
HMRC source
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