Background
An individual must notify HM Revenue & Customs (‘HMRC’) by 5 October following the end of a tax year if they have a liability to tax and are not already registered for Self-Assessment. Failure to notify by this date can result in penalties.
Anyone who has a new source of income for the year ended 5 April 2025 and is not already registered for Self-Assessment must therefore register with HMRC by Sunday 5 October 2025.
Detail
Individuals not already registered for Self-Assessment and who may have started to earn new income that has not been subjected to tax at source must register with HMRC by 5 October following the end of the tax year. Examples of new sources of income could include self-employment, joining a partnership, additional freelance work, rental income, selling goods online, crypto currency transactions and sales of capital assets.
Registration is an important administrative process to ensure those individuals new to self-assessment are issued with a Unique Taxpayer Reference (UTR), which will be required in order to complete their tax return. Many more individuals are likely to be again impacted this year, especially with high interest rates on savings, crypto investors and the ever growing number of users of online platforms, such as Airbnb, Vinted and eBay to sell everything from holiday lettings to second hand clothing.
Examples of individuals who may need to take action by 5 October are as follows:
- where self-employment or casual income (e.g. from online selling) exceeds £1,000 in a tax year;
- where savings and investment income is over £10,000 (although tax may still be due on income over £1,000 for a basic rate taxpayer or £500 for a higher rate taxpayer);
- where dividend income is over £10,000 (although tax may still be payable on any dividend income over £500);
- where rental income is over £2,500 net (i.e. after deducting allowable expenses) or £10,000 gross in a tax year;
- where other untaxed income is £2,500 or more;
- where a claim is required for tax relief for employment expenses of more than £2,500;
- where total income before tax is over £100,000;
- where there is a capital gain in excess of £3,000 or if the value of the assets given away or sold were worth in excess of £50,000;
- where income for them or their partner is over £60,000 and they are in receipt of child benefit and they are not using the new HICBC PAYE service.
The requirement for individuals with a PAYE income threshold of £150,000 or more to also be registered for self-assessment has been removed for the 2024/25 tax year.
The above list focuses on some of the more common examples of when an individual may need to complete a tax return, but an individual could have untaxed income below these thresholds and may still need to contact HMRC in order to arrange collection of any tax due. It is also possible to voluntarily register for self-assessment even if an individual does not meet the requirements for filing a tax return.
Anyone who is unsure if they need to submit a return can use HMRC’s online checking tool on gov.uk before registering.
If the deadline of 5 October is missed, as that is ‘the deadline to notify chargeability’, it is possible to sign up for self-assessment at any time. However, there are penalties that may apply for late notification.
Online self-assessment taxpayers then have until 31 January 2026 to complete their tax return and pay any tax owed for the 2024-25 tax year.
Anyone who no longer needs to file a self-assessment tax return should inform HMRC as soon as possible. Individuals will also need to notify HMRC if they have stopped being self-employed.
If you would like further information regarding the criteria for Self-Assessment or if you would like assistance in registering for Self-Assessment, please contact our Tax Manager, Jo Fahy.
To see our other news items please visit our Muras Baker Jones – Blog.