Severn Accounting
Tax & Accounting

Do you need to complete a tax return

By Ali Jaw ·

Many people aren’t entirely sure whether they need to complete a tax return. The short answer is: it depends on your circumstances. However, Her Majesty’s Revenue and Customs (HMRC) does expect certain people to file one, and submitting a return when you’re not obligated to can actually work in your favour. Let’s walk through who needs to complete a tax return in the 2024/25 tax year and what happens if you’re unsure.

Who Must Complete a Tax Return

HMRC will tell you if you need to submit a Self Assessment tax return. They’ll issue a notice to file, usually by October of the relevant tax year. You’re legally required to complete one if you’re sent this notice.

That said, certain people are almost certain to receive a notice. These include:

  • Self-employed individuals with trading income above the Small Profits Threshold (currently £1,000 per tax year)
  • Company directors, even if the company made no profit
  • People with a tax liability that hasn’t been paid through PAYE
  • Those with untaxed income, such as rental profits, investment income, or savings interest above the Personal Savings Allowance
  • High earners whose PAYE doesn’t account for all their tax (for example, those earning over £100,000 who’ve lost their Personal Allowance)

If you fall into any of these categories, submitting a return isn’t optional—it’s a legal requirement.

When You Might Want to File Voluntarily

Even if HMRC hasn’t issued you a notice, there are several reasons why completing a tax return could benefit you.

If you’re employed and have paid too much tax through PAYE, filing a return can help you reclaim the overpayment. Similarly, if you have personal allowances you haven’t used, a return gives you a way to claim any refund due.

You might also benefit from claiming tax relief on specific expenses. For example, if you’re a sole trader who’s incurred legitimate business costs, a return allows you to set these against your income and reduce your tax bill. Working from home expenses, professional fees, and equipment costs can all be claimed.

Additionally, if you’ve had losses in your business or investments, filing a return means you can carry these forward or claim relief against other income.

The golden rule: if in doubt, file. If you don’t owe anything, you’ll simply receive a nil assessment. However, if you owed tax and didn’t file, you could face a penalty from HMRC.

Important Deadlines and Penalties

The Self Assessment deadline for the 2023/24 tax year was 31 January 2025. If you missed this, you’re now facing a late filing penalty of at least £100 (for individuals), even if you don’t owe any tax.

If you file more than three months late, the penalty increases to £10 per day (up to £900) or 5% of your tax due—whichever is higher. After six months, the penalty rises to 5% of your tax due (or £300 minimum), and after a year, it’s 5% again or £300 minimum.

These penalties apply regardless of whether you’ve underpaid tax, which is why acting quickly matters if you’ve missed the deadline.

For the 2024/25 tax year, the deadline is 31 January 2026 if you’re filing online with a paper notice of assessment, or earlier if you’re filing a paper return.

Company Directors and Corporation Tax Returns

If you’re a company director, you’ll typically need to file a Corporation Tax return with Companies House within nine months and ten days of the accounting period end. This is separate from any personal Self Assessment return you might owe. Many directors also need to complete personal tax returns if they’ve paid themselves dividends or have other income sources.

What You’ll Need

Before sitting down to file, gather:

  • Your Self Assessment Unique Taxpayer Reference (UTR)
  • Records of income from all sources
  • Receipts and records of allowable expenses
  • P45 or P60 forms from employment
  • Details of any savings or investment income
  • Proof of tax paid during the year

Getting Help

Tax rules can feel complicated, especially if you’re self-employed for the first time or have multiple income sources. Making errors on your return could lead to incorrect assessments or missed reliefs.

For tailored advice, contact Severn Accounting—we’re here to help.