Who Really Needs to File a Self-Assessment Tax Return in the UK?

Understanding the Basics of Self-Assessment

In the UK, the tax system works differently for different people. Most employees never have to touch a tax form — their tax is taken straight from their wages through PAYE (Pay As You Earn). But that’s not the full picture. There’s a whole group of people who must tell HMRC about their income themselves. That’s where the self assessment tax return accountant often comes in.

Self-assessment is HMRC’s way of collecting income tax from individuals whose earnings aren’t fully taxed at source. If you fall into certain categories, you must file a return — even if you think you’ve paid enough already.

Who Needs to Do a Self Assessment Tax Return?

This is the big question. And the answer is more varied than most people think. HMRC expects a tax return if you:

Are self-employed as a sole trader and earned more than £1,000 (before deducting expenses) in the tax year.
Are in a business partnership.
Receive rental income from property in the UK or abroad.
Earn income from investments, savings, or dividends that wasn’t taxed at source.
Have foreign income (including pensions) that may be taxable in the UK.
Receive tips, commissions, or freelance income outside your main job.
Claim certain tax reliefs, like on charitable donations or work expenses, that can’t be done through PAYE.
Had income over £100,000 — even if all your earnings were from employment.

The Grey Areas

Some cases aren’t so black and white. For example, someone with a small side hustle selling crafts online may still need to file. If you earned over £1,000 from it, HMRC wants to know.

Also, if you’ve sold shares, cryptocurrency, or even a second property, you might have capital gains to declare. Even if you think no tax is due, the reporting requirement can still apply.

This is where people often search “do I need to complete a tax return?” — and the safest approach is to check directly with HMRC or speak to a professional.

Why HMRC Cares About ‘Small’ Income

You might be thinking, “Surely HMRC won’t bother with my £1,500 side hustle?”
But the tax rules are clear. If it meets the threshold, you must report it.

The self-assessment system isn’t just for high earners or business owners. It’s for anyone with untaxed income that pushes them into HMRC’s reporting criteria.

Deadlines You Can’t Ignore

Missing a deadline for filing or paying your tax bill is costly. Here’s the usual cycle:

Tax year ends: 5 April.
Paper return deadline: 31 October.
Online return deadline: 31 January.
Payment deadline: Also 31 January.

Late filing fees start at £100 and can grow quickly. Interest is charged on late payments.

Why Many People Use a Self Assessment Tax Return Accountant

The rules aren’t always simple. For example:

Some tax-free allowances reduce your bill — but you must claim them correctly.
Certain expenses can be deducted, but only if they qualify under HMRC rules.
Filing incorrectly can trigger penalties or investigations.

A self assessment tax return accountant can make sure your return is accurate and compliant, potentially saving you far more than their fee. They’ll also spot reliefs you might not know about, like marriage allowance or property income deductions.

Common Scenarios Where You Must File

1. Side Businesses and Freelance Gigs

Even occasional freelance work — writing, photography, consulting — counts as taxable income if it crosses the £1,000 threshold.

2. Property Landlords

Rental income from letting out a house, flat, or even a spare room (outside the rent-a-room allowance) must be declared.

3. High Earners

If your income exceeds £100,000, the personal allowance tapers away, and a return becomes mandatory.

4. Company Directors

Many directors need to file even if they take most income via PAYE, especially if they receive dividends.

My First Tax Return Story (And What It Taught Me)

Back in 2014, I was juggling a full-time job and selling refurbished bikes online. I assumed my PAYE covered everything.
One day, a brown HMRC envelope arrived — not the friendly kind. They’d noticed extra income in my bank records. I had missed the self-assessment deadline. The penalty? £100 plus daily fines until I filed. That mistake cost me over £300.

If I’d checked “who needs to do a self assessment tax return” earlier, I could’ve avoided it.

The HMRC ‘Nudge’ Letters

HMRC sometimes sends “nudge” letters to people they believe should be filing but aren’t. They use bank data, online sales records, and even overseas income data to identify gaps.
If you get one of these, take it seriously. Ignoring it can lead to a formal investigation.

Do I Need to Complete a Tax Return If I’m Retired?

Not always. If your only income is from a UK state pension and it’s under your personal allowance, no return is needed. But if you have private pensions, overseas income, or investment earnings, a return may be required.

What Happens If You Don’t File When You Should?

Automatic penalties: £100 after the first missed deadline.
Daily fines: £10 per day after three months (up to 90 days).
Six-month penalty: 5% of the tax due or £300 (whichever is greater).
Interest charges on late tax.

In serious cases, HMRC can open a compliance check or prosecution.

Self-Assessment Myths

Myth 1: “I’m PAYE so I never need to file.”
Wrong. Side income can change that.
Myth 2: “HMRC won’t notice small amounts.”
They do. Digital banking and reporting systems flag discrepancies.
Myth 3: “If I miss a deadline, I can just file next year.”
Penalties still apply for the missed year.

How to File (Without the Headache)

Register for self-assessment by 5 October after the tax year you need to file for.
Gather your records: invoices, receipts, P60/P45, bank statements.
Use HMRC’s online portal or approved software.
Double-check allowances and reliefs.
Submit and pay before 31 January.

If this feels overwhelming, a professional can take it off your hands entirely.

When a Self Assessment Tax Return Accountant is Worth It

You have multiple income streams.
You’re unsure about deductions.
You’ve had penalties before.
You run a business or rental property.
You’ve sold assets with potential capital gains.

They can also help with planning ahead — ensuring you set aside enough for future tax bills.

Conclusion: Don’t Guess, Get It Right

Filing a self-assessment isn’t just about following rules — it’s about protecting yourself from unnecessary stress, penalties, and overpayments.

If you’ve been wondering “do I need to complete a tax return?”, the answer lies in your income sources, not just your main job. Even small side earnings can tip the balance.

And if in doubt, speak to a self assessment tax return accountant who can guide you through the process and make sure HMRC gets exactly what it needs — no more, no less.