Income tax applies to anyone living or working in the UK and earning above a certain amount of money each year (currently £12,500). More specifically, both individuals and companies pay income tax on all earnings where the amount of earnings exceeds a certain threshold.
Income tax is paid on your net income, which is after taking into account any expenses or losses incurred during the period for which you are paying income tax. For example, if you own a car which costs £15k per year to run but gives you an annual saving of £10k by not having to use public transport, then this saving would be deducted from your taxable income when calculating how much IHT should be payable on it.
In the UK, there are different income tax rates based on how much money you earn each year.
If you are employed, your employer will deduct income tax from your wages and send this money to HMRC for you. In addition to paying income tax, many employees also have National Insurance contributions deducted from their pay cheques.
If you are self-employed or run your own business or partnership, then it’s up to you how much income tax you pay – whether through PAYE (Pay As You Earn) or self-assessment.
You will need to complete a Self-Assessment Tax Return if you are self-employed, earn over £100,000 per year or have more than one job and earn over £50,000 from them.
So if you're looking for a Self Assessment Accountant, NBAS can advise you on whether this applies to you and help with your return if it does.
If you have more than one job and your total earnings from this exceed £100,000 then you need to register for Self-Assessment. Otherwise, additional payments may be due when completing your Self-Assessment Tax Return with HMRC which could lead to penalties for late payment as well as interest accrued until they are paid. We recommend getting in touch to get some expert advice if you have any concerns or queries about the process.
You must submit a self-assessment tax return by 31st January following the end of every tax year (5th April every year). If you fail to submit a return within three months of its due date, this will result in late filing penalties. The penalty will be 100% on any balance outstanding after three months but reduced by 50% if paid within nine months and 25% if paid after 12 months.
Our team here at experienced in the ins and outs of all tax queries, Please enquire if you're requiring expert advice from a Self Assessment Accountant.
I had historically completed my own tax returns, but recently due to pressures of work had taken my eye off the ball.
We asked Nigel to analyse our financial affairs and he has already saved us many thousands of pounds, with the prospect of further bigger savings to come from previously declared returns.
He is diligent, communicative and we would recommend him without exception to anyone.
Working with Nigel has been a pleasure and very insightful.
His patient approach in explaining the account procedures of my business has been most welcome. As a start up company Nigel has taken away the pressure of the accounting side, which has saved my company time and put me at ease that the accounts are with a trusted and highly skilled professional person. Would happily recommend Nigel to any start up business or existing business.
I was so grateful and relieved to have found Nigel and given him both my corporate and personal tax affairs to deal with. Having had a somewhat chaotic experience with my previous accountant.
I was delighted to find that Nigel was efficient and communicative. Of greatest value to me was his willingness to be available and patient with all the queries I had, and there were many! Another immensely important aspect of the work he has done for me is that he has saved me money! I am finally worry-free regarding my tax affairs as I know I am in extremely good hands.
This is my first time being self-employed and I found the idea of being responsible for my own tax affairs a daunting experience.
Nigel, during our very first meeting, put my mind at ease with regards to tax payments and offered advice on the benefits of being VAT registered which I was previously unaware of. Nigel also advised and assisted with the transfer of my business into a limited company and took care of all the necessary paperwork required.
I am a natural worrier but Nigel responded quickly to my queries, whether by email or face-to-face meetings, and I am confident that my business is in safe and competent hands.
Stay connected and up-to-date with the latest news, insights, and trends in accounting by joining the mailing list of NBAS Chartered Accountants. Whether you're a business owner, professional, or simply interested in the world of finance, our updates will provide you with valuable information and knowledge.
