Latest news with #selfassessment
The Sun
7 days ago
- Business
- The Sun
Do you have a side hustle? Act NOW or risk huge fine after HMRC warning
HMRC has issued an urgent warning to anyone with a side hustle to act now or risk being hit with a big fine. Those earning money from an extra income stream, including online selling, have to submit tax returns through self-assessment. 1 Anyone earning more than £1,000 a year has to submit one - and the deadline to do it online for the 2024/25 tax year is January 31, 2026. If you've not registered for self-assessment before, you must register by October 5. Fail to do either of these things and you could end up facing a hefty fine from HMRC. Filing your self-assessment tax return after January 31 and just one day late will see you fined £100. You also face further fines of £10 a day after three months, up to a maximum of £900. Of course, the January 31 deadline to file your tax return is months away, but filing early can give a chance to budget for any taxed owed. You may be able to set up a Budget Payment Plan to help spread the cost of taxed owed too. National Insurance owed. Myrtle Lloyd, HMRC's director general for customer services, said: "Whether you are selling handmade crafts online, creating digital content, or renting out property, understanding your tax obligations is essential. "If you earn more than £1,000 from these activities, you may need to complete a self assessment tax return. What Does My Tax Code Mean? A Simple Guide to Your HMRC Letter "Filing early puts you in control – you will know exactly what you owe, can plan your payments, and avoid the stress of the January rush. "You don't need to pay immediately when you file – you have until January 31 to settle your tax bill." How to register for self-assessment and file a tax return If you're submitting a tax return for the first time, you'll need to register for self-assessment by October 5. You are taken through the process step by step via the Government website which is on You start by hitting the "Start Now" button at the bottom of the page. After you've registered, you'll be sent a Unique Taxpayer Reference (UTR) number in a letter, with instructions on how to set up your Government Gateway account. Once this is done, you'll be sent another letter containing an activation code. You use this to complete the set-up of your account and need to do this as soon as possible as the code will expire. HMRC says this entire process can take up to 20 working days. Once you've registered, filing a tax return online can be done via Make sure you've got your UTR number to hand. You don't have to complete your tax return in one go and can save your entry then go back to it later if you need to. Why do you have to submit a tax return on your side hustle earnings? In some cases, tax is deducted automatically from your wages or pension through PAYE. However, other forms of income, such as those from a side hustle worth over £1,000 are collected through self-assessment. This is where the person who owes the tax has to submit a tax return themselves. You also have to file a self-assessment tax return if you receive any other income from property, capital gains, or dividends. Do I need to pay tax on my side hustle? When you're employed the company you work for takes the tax from your earnings and pays HMRC so you don't have to. But anyone earning extra cash, for example from selling things online or dog walking, may have to do it themselves. Stephen Moor, head of employment at law firm Ashfords, said: "Caution should be taken if you're earning an additional income, as this is likely to be taxable. "The side hustle could be treated as taxable trading income, which can include providing services or selling products." You can make a gross income of up to £1,000 a year tax-free via the trading allowance, but over this and you'll usually need to pay tax. Stephen added: "The applicable tax bands and the amount of tax you need to pay will depend on your income."
Entrepreneur
14-06-2025
- Business
- Entrepreneur
Entrepreneur UK's London 100: Taxd
Industry: Fintech Taxd is a digital tax filing platform that facilitates the completion of self-assessment tax returns. HMRC-recognised, Taxd offers a digital service that simplifies the process through step-by-step guidance and real-time support. Taxd has transformed the financial sector by blending innovative technology and accounting expertise. Co-founders and former PwC accountants Arjun Kumar and Eamon Shahir realised there was a gap in accessibility to affordable, straightforward accountants and a lack of understanding of tax systems, so they sought to remedy that. The platform's cutting-edge technology is thanks to the expertise of James Green, the third co-founder and Chief Technology Officer. In early development, Taxd was simply an idea on a Google Doc. The team would frequently meet in London, working day and night to bring their vision to life. "Taxd is great for London's startup ecosystem because we make taxes easier. We save founders time and money so they can focus on their startups. With expert support for expat tax, we have a niche for supporting founders moving to the UK or those who may be scaling across the globe. Similarly, for companies, our cost-effective, automated solution is perfect for bootstrapped founders looking to stay lean and efficient," says Kumar.
Entrepreneur
11-06-2025
- Business
- Entrepreneur
Terribly Taxing
Opinions expressed by Entrepreneur contributors are their own. You're reading Entrepreneur United Kingdom, an international franchise of Entrepreneur Media. For most people, tax season is a time of quiet dread - a looming deadline, a barrage of jargon, and a vague fear of doing it all wrong. But for Arj Kumar, it was the beginning of an idea: what if the headache could be removed entirely? As co-founder of Taxd, a London based digital tax platform designed to demystify and democratise self-assessment and a winner in the recent Entrepreneur UK London 100 list, Kumar is part of a new wave of fintech entrepreneurs shaking up a sector long defined by paper trails and pricey accountants. "We knew trust would be our biggest hurdle," says Kumar, reflecting on the platform's earliest days. "Tax is deeply personal, and most people associate it with face-to-face interactions. We had to show people that a tech-led solution could not only be just as effective - but even better." That meant obsessing over user experience, ensuring each interaction felt human, helpful, and secure. The platform combines automation with expert support, while its slick interface offers a far cry from HMRC's clunky portals. Trust, Kumar explains, was earned one client at a time - through clear communication, transparent pricing, and the reliability of a system built not just by engineers, but by tax professionals who understood the pain points firsthand. Kumar's journey began at PwC, where he and fellow co-founder Eamon Shahir saw the inefficiencies of traditional tax filing up close. Alongside James Green, who brought the technical muscle, they built a product that promised a smoother, faster, and far more affordable alternative. In the early days, they did what Kumar calls "things that don't scale" - late-night calls with customers, personalised guidance, endless tweaks to the platform based on direct feedback. It wasn't glamorous, but it worked. Still, the road wasn't always smooth. "We were fresh from PwC and had no real idea how to raise capital," Kumar admits. "Learning to speak the VC language - that took time. If I could do it again, I'd spend more time upfront understanding how the start-up ecosystem actually works." Today, Taxd is gaining ground with freelancers, contractors, and small business owners looking for an easier way to stay on the right side of HMRC. And Kumar has a few words of advice for founders following in his footsteps: focus on a real problem, know your domain inside out, and surround yourself with people who share the load. "If you can identify the cracks in a system you understand, you're halfway there. Then it's just about building something better - and proving it works."
Telegraph
23-05-2025
- Telegraph
Taxpayer wins £1.7k over ‘scam' HMRC fine
A taxpayer has won a £1,700 appeal after late penalty emails from HM Revenue & Customs (HMRC) were sent to her junk mail. Denise Howarth was issued a £100 penalty after she completed her 2020-2021 self-assessment, but failed to click the final button to submit the return. Ms Howarth did not realise she had incurred a penalty until March 2023, by which time subsequent late payment charges and interest had raised the amount she owed to £1,770.67. She immediately filed the tax return and submitted an appeal. At a First Tier Tribunal, HMRC argued that emails about the penalty were sent to Mrs Howarth. But they went to her junk mail and were deleted. The Tribunal found that this was a reasonable excuse, as the emails could have been mistaken for a scam or phishing exercise. Ms Howarth had a record of submitting her tax returns on time dating back to 2004, with the exception of the 2019-2020 tax year when HMRC's computer records showed that she filed a day late. The Tribunal found that Ms Howarth had in fact filed on time. On the same day that Ms Howarth filed her 2019-20 return, she chose to be contacted by HMRC electronically through email alerts. These messages notify taxpayers when there is an update on their account, but do not indicate the level of urgency. Howarth had no recollection of signing up for electronic alerts. There was evidence that she had deleted at least three of these emails which had been sent to her junk folder as she believed they were phishing scams. Ms Howarth also filled out her 2020-2021 tax return on the day of the deadline, but did not complete the process or receive a confirmation code. However, she took a screenshot of what she believed to be the final page of the submission process. 'Unconscionable for HMRC to pursue penalties' Judge Keith Gordon said: 'In some way, the appellant was the author of her own misfortune in two key respects. She had signed up to receive electronic communications from HMRC and, on at least three occasions, deleted genuine emails from HMRC which should have alerted her to check her personal tax account. 'On the other hand, the appellant clearly strove to comply with her tax obligations over a number of years. There is nothing wrong with a taxpayer – particularly one with relatively simple affairs – routinely leaving the task of submitting a tax return to the evening of the deadline, or the previous day.' The Tribunal also found that the appellant had good reason to believe that the 'bland' e-mail messages being sent by HMRC were 'spam and/or phishing exercises', and that it was reasonable for her to promptly delete them. John Hood, tax partner with accountancy firm Moore Kingston Smith and a former HMRC inspector, said the case highlighted the problems with automatic penalties charged by HMRC for late filing. He added: 'While the penalties system is properly intended to fine people who do not comply and submit their return on time, there will always be situations where people who have acted correctly are caught out. 'Frankly, it seems unconscionable for HMRC to pursue penalties from someone who did take every effort to submit their return on time but fell short due to IT issues beyond her control.' An HMRC spokesman said: 'We are disappointed with the decision, which was based on the specific facts of the case, and we are currently considering our next steps.'
Entrepreneur
16-05-2025
- Business
- Entrepreneur
Is It Time to Fire Yourself? Here Are 5 Signs You're Holding Your Company Back
Most CEOs don't usually think about putting themselves up on the firing block, but there are many instances where you, as the CEO of the business, may be holding your business back. You need to be honest in your assessment of yourself as CEO, to make sure you are, in fact, the right person for the job. This article will help you identify certain scenarios where a CEO change may be necessary, even if it means you firing yourself from the job. Related: How to Develop a 'C-Suite Mindset' for Success, From 5 Leaders Who Have Done It
