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Site updated:

4 July 2009

Tax - In England

Tax returns

This information applies to England, Wales, Scotland and Northern Ireland

What is a tax return

A tax return is a form (paper or online) on which you:

report details of your taxable income, and any capital gains if appropriate
claim tax allowances and tax reliefs.

HM Revenue and Customs (HMRC) may issue a tax return to you each year. If you receive a tax return, the law says you must fill it in.

HMRC uses the information on your tax return to work out your tax bill or work out whether you are due a tax refund.

Who should complete a tax return

Most taxpayers do not have to fill in a tax return. If HMRC thinks you are paying the right amount of tax through the Pay As You Earn (PAYE) system on your wages or salary, or on an occupational pension, they will not send you a tax return.

For more information about PAYE, see The Pay As You Earn - PAYE - system.

However, HMRC will issue annual tax returns if you:

are self-employed
are a company director (but not if you are a director of a not-for-profit company)
have rental or other income from property (unless it is less than a certain amount and can be dealt with through a PAYE tax code)
have other income which not taxed before you get it and the tax cannot be collected through the PAYE system.

If you are a pensioner

Most pensioners do not fill in tax returns. However, tax-free allowances for people 65 or over are based on annual income so a tax return may sometimes be necessary.

If you're a pensioner whose only source of taxable income is your State Retirement Pension, you have to fill in an annual tax return if the amount you receive is higher than your tax-free personal allowances. This is because the Department for Work and Pensions (DWP) which pays the State Retirement Pension does not deduct any tax before the pension is paid.

If you have not received a tax return

It's your responsibility to inform HMRC that you have received income on which tax is payable. You should do this at the latest by 6 October following the end of the tax tear in which your income first arose.

If you have not received a tax return but you think you should fill one in, phone or write to your tax office if you know their contact details. Or phone the HMRC helpline on: 0845 9000 444 and ask for a return to be sent to you. Do not wait for HMRC to contact you. If you send in the tax return late, you may have to pay:

interest on any tax paid late, and
a penalty.

If you think you have paid too much tax

If you think you have paid too much tax, do not assume that HMRC will find this out automatically. Contact your tax office if you know their details or phone the HMRC helpline on: 0845 9000 444 and ask for a tax return to be sent to you.

If you don't think you should fill in the tax return

If you have been sent a tax return but you don't think you should have to fill it in, do not just ignore the tax return. If HMRC does not receive the tax return by the date it has to be returned, they will issue an automatic penalty.

If you get a tax return that you think you shouldn't have to fill in, contact HMRC. The correct phone number will be printed on the front of the form. If they agree that you shouldn’t have to fill in the form, they will confirm this in writing.

If HMRC think you no longer need to fill in a tax return

If you have been filling in tax returns but HMRC think you no longer need to fill in a tax return, they will send you a letter telling you that they do not propose to send you tax returns in the future. The letter will warn you that if your financial circumstances change in the future, you must let them know straightaway.

More information about who should fill in a form

You can get more information about when a tax return is needed on the HMRC website at: www.hmrc.gov.uk.

Completing the tax return form

You can complete your tax return on paper or online using HMRC software or commercial software.

Deadline for sending back a tax return

There are different dates for sending back paper and online tax returns. These dates are called the filing dates. A paper tax return must be received by HMRC by 31 October following the end of the tax year. An online tax return must be received by HMRC by 31 January following the end of the tax year.

If you don't send in your tax return by the filing date, you will automatically incur a late filing penalty of £100. You will incur another £100 penalty if the tax return is still outstanding six months later.

If you send in a paper tax return after 31 October, you can't avoid the late filing penalty by filing an online return by 31 January. However, if the amount of tax you owe is less than £100, HMRC may reduce the penalty to an amount equal to the tax due.

The paper tax return

The paper tax return is made up of:

a core six-page form that is sent to everyone who receives a paper return, and
extra (supplementary) pages covering specific types of income and capital gains. Some of these are attached to the tax return and others are loose. There is a series of questions on page 2 of the tax return which will help you to check if you need any loose supplementary pages.

In each tax return pack, there is also:

a set of additional information supplementary pages, covering less common types of income and tax reliefs
a form to nominate a charity to receive part or all of any tax repayment that may be due to you, if you wish
a guide to completing the tax return.

If your tax affairs are straightforward, you may be sent a Short Tax Return which only has four sides to fill in. Pensioners, employees excluding company directors, and self-employed individuals whose turnover is below £30,000 are likely to get a Short Tax Return. HMRC sends a tax return guide with the Short Tax Return.

So long as you send your paper return by the filing date, HMRC guarantees to calculate your tax bill and let you know the result before the payment date of 31 January following the end of the tax year. HMRC calculates the tax bill of every tax return they process. However, if you file a paper return after 31 October, they cannot guarantee to tell you the result in time for any 31 January payment.

If your paper return is late, or if you wish to calculate your tax bill yourself, you can ask the HMRC Orderline on 0845 9000 404 for the Tax Calculation Summary supplementary pages and notes to work out your tax bill. You do not have to send back these pages as part of your tax return.

The online tax return

To use the HMRC online return service, you will first have to register. Go to the HMRC website at: www.hmrc.gov.uk and follow the registration process. You will have to wait for up to seven days for a Personal Identification Number so do not leave registering for online filing until 31 January. If you do, your return will be late and you will incur a late filing penalty.

The online tax return will ask you a series of questions to bring forward only the relevant parts of the tax return. It will do the calculations for you and provide on-screen help as you go along. There are other built-in checks to help you get it right.

Your tax bill will be worked out automatically and you will receive an acknowledgement that your tax return has been safely received.

Keeping records

By law, you must keep the records you need to fill in a complete and correct tax return. If your return is incomplete and you are then found to owe tax, you may also have to pay interest and a penalty.

Your employer or pension provider will provide you with details of your income and tax paid. If you receive employment-related benefits, your employer will provide the information needed for your tax return.

If you are self-employed, you will have to use your business records (or accounts, if you have them) to complete the Self-employment pages of your tax return.

If you need help with this, contact HMRC, or an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.

If your only property income is from letting a room in your own home and the income is below the rent-a-room limit, you may only have to complete one box on the UK property pages of the tax return.

You may need to ask your bank or building society for the interest details for your tax return (although they may be provided on statements or in passbooks). Some banks and building societies charge for this service.

Use of provisional and estimated figures

If you're waiting for some of the information you need for your tax return, you may provide provisional figures, so you don't delay filing your tax return. You should draw attention to this in the Any other information box on a paper return or in the white space on an online return. You should replace any provisional figures with the final ones as soon as you know them.

You may sometimes have to estimate an amount, for example, the private proportion of motoring expenses or the costs of using your own home for business. These figures need not be replaced and you may not have to draw attention to this kind of estimate. There is guidance about his on the tax return.

Errors on tax returns

If you or HMRC find a minor error on your tax return, it can often be put right by a phone call.

If your income was overstated and you have paid more tax than is due, HMRC will repay the amount overpaid with an appropriate amount of interest.

If there has been a significant error resulting in under-declared income, HMRC may consider this to be grounds for opening an enquiry. If the error is due to negligence or fraud, you may have to pay a penalty, as well as interest on tax paid late. You can get more information about HMRC enquiries from the website the Low Incomes Tax Reform Group at: www.litrg.org.uk.

If HMRC opens an enquiry into your tax situation, you should consult an experienced adviser, for example, at a Citizens Advice Bureau. To search for details of your nearest CAB, including those that can give advice by e-mail, click on nearest CAB.