Self Assessment made simple: a friendly guide for first-timers

Author: Phillips & Co Accountants, Chester

Date: 25 September, 2025

Self Assessment can feel intimidating the first time you do it. Good news: it’s just a series of small steps. Below we explain the process two ways—first for a sole trader, and then for someone who just needs a tax return filed (no business).

Key dates (for every filer)

• Register (first return): by 5 October after the tax year ends
• Paper return deadline: 31 October
• Online return & payment deadline: 31 January
• Payments on account (if due): 31 January and 31 July
• Amend your return: within 12 months of 31 January
• Keep records: at least 5 years after the 31 January filing deadline

UK tax year runs 6 April – 5 April. Example: the 2024/25 return covers 6 Apr 2024–5 Apr 2025 and is due 31 Jan 2026 if filing online.

Part A — I’m a sole trader (self-employed):

1) Register with HMRC

If it’s your first return, register for Self Assessment and Class 2/4 National Insurance. HMRC will post you a UTR (10-digit tax reference).

Already filed before? Just sign in and add Self Employment if it’s new this year.

2) Keep simple, complete records

• Income: sales invoices, takings, bank statements.
• Expenses: receipts for tools, software, phone, mileage log, business use of home, insurance, professional fees, etc.
• Use a spreadsheet or bookkeeping app. From 2026, many sole traders/landlords will join Making Tax Digital (quarterly updates), so getting tidy now helps.

3) Understand what you’ll pay:

• Income tax on your profits (after the personal allowance if available).
• Class 2 NIC (flat weekly rate if profits over the small profits threshold).
• Class 4 NIC (percentage of profits in set bands).
• Payments on account may apply if your tax bill is over a threshold—these are advance payments towards next year’s bill, due in Jan and Jul.

4) File your return online

• Complete the SA100 plus the self-employment pages (turnover, allowable expenses, capital allowances).
• Check totals carefully, especially use of home, mileage, capital items (laptop/van), and pre-trade costs (some can be claimed).
• Submit, save the submission receipt, and download a copy of the return and calculation.

5) Pay (and plan ahead)

• Pay by bank transfer, online banking, debit card, or via your HMRC account.
• Save for tax through the year—many sole traders set aside 20–30% of profits monthly so January isn’t a shock.
• If income falls, you may be able to reduce payments on account; if cash is tight, HMRC’s Time to Pay can spread the cost.

Common sole-trader pitfalls

• Claiming the £1,000 trading allowance when your actual expenses are higher (you can’t claim both).
• Forgetting use of home, software subscriptions, and mileage.
• Mixing personal and business banking (harder to evidence).
• Missing the 31 July payment on account.

Part B — I’m not self-employed; I just need a tax return filed:

Typical reasons you might need to file:

• Rental income (UK or overseas)
• Capital gains (sold shares, crypto, second property, etc.)
• High income with child benefit (HICBC)
• Savings/dividends above the allowances
• Company directors (sometimes required) or complex tax affairs
• HMRC has issued a notice to file.

1) Register (first time) and get your UTR

You still register by 5 October and wait for your UTR.

2) Gather the right documents

• Employment: P60/P45, P11D (benefits), student loan statements.
• Savings & dividends: annual interest/dividend summaries from banks/brokers.
• Property: rental statements, mortgage interest (for the basic rate credit), service charges/repairs, agent fees, furnishings.
• Capital gains: broker reports with purchase/sale dates and costs.
• Pensions & Gift Aid: certificates and dates paid.
• Foreign income: statements and any foreign tax paid (for relief).

3) Complete the return

• SA100 plus the relevant schedules (property, foreign, capital gains, etc.).
• Claim reliefs correctly (e.g., lettings relief rules are very narrow now; repairs vs. improvements; foreign tax credit relief).
• Double-check your student loan plan type and any child benefit charge.

4) Submit and pay

File online by 31 January and pay the balance (and payments on account if due).

Keep all evidence and the submission receipt.

Common non-business pitfalls

• Missing bank interest (even small amounts).
• Misunderstanding repairs vs improvements for rental expenses.
• Not reporting foreign dividends or overseas pensions.
• Overlooking capital gains on funds/crypto disposals.
• Penalties & corrections (for everyone)
• Missed filing/payment triggers penalties and interest.

If you spot an error, you can amend within 12 months of the 31 January deadline.

If HMRC thinks the original estimate was too low (e.g., reduced payments on account), they’ll charge interest on the shortfall—keep sensible notes of how you calculated figures.

A calm, step-by-step checklist

• Check if you must file (or if HMRC sent a notice).
• Register by 5 October (first timers).
• Collect records (income, expenses, documents).
• Complete the return (add the right schedules).
• Review & submit (save the receipt).
• Pay by 31 January (and 31 July if payments on account apply).
• Keep records for 5 years after the filing deadline.

How Phillips & Co helps (Accountants Chester)

• First-time filer setup: registration, UTR, HMRC account
• Sole-trader returns: we turn your records into tidy accounts and claim the right expenses
• Landlords: correct treatment of mortgage interest, repairs, and allowable costs
• Capital gains: calculations, use of losses, and timing advice
• Foreign income & reliefs: avoid double taxation
• Payments on account: set sensible amounts and avoid interest
• Fixed fees, plain English — and we file on time

Call/WhatsApp today on: 01244 220 062

If you’d like expert guidance, contact Phillips & Co Accountants Chester today.

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