Relaxation of self-assessment threshold
HMRC has promised a change to the threshold at which self-employed taxpayers need to complete a tax return. What do we know so far?
Currently, those with trading income exceeding £1,000 must submit a tax return each year, even if they do not have any tax to pay. HMRC has announced that the threshold will increase to £3,000, which it estimates will mean up to 300,000 people no longer needing to submit tax returns. There is no firm date for this, with the government saying that it will happen “within this parliament”, i.e. before the next general election.
The threshold applies to the gross income the self-employed person earns in a tax year, i.e. before deducting any expenses. Some affected individuals will still have an income tax liability, and HMRC intends to launch a “simple” online service to collect the tax in the absence of a self-assessment tax return. However, there is no information about what this will look like or how it will work yet.
Related Topics
-
HMRC loses employment status case involving football referees
HMRC has lost another employment status case, this time involving football referees engaged by Professional Game Match Officials Ltd (PGMOL). The tribunal rejected HMRC’s argument that the referees should be treated as employees for tax purposes. Why does the decision matter?
-
Investing: loans vs shares
You have the opportunity to invest in a promising start-up company. You can either purchase shares or lend it the money. What are the potential tax consequences you need to factor in when making your decision?
-
Where can you get help with MTD quarterly updates?
As Making Tax Digital for Income Tax (MTD IT) filing obligations begin for some taxpayers, questions are continuing to arise around quarterly updates and how problems should be resolved. If issues occur, where should you go for help?