Self-assessment for freelancers and contractors

Everything you need to know about tax returns and refunds for contractors and freelancers

Our experts at DSR Tax Claims know how complicated matters can get when you are having to deal with your own tax returns, especially if you are a freelancer or contractor. It can be difficult to navigate your way through the maze of HMRC regulations and that is why our team of experts have created this helpful guide, to tell you everything you need to know about your self-assessment tax return. You might also want to check out our handy online calculator to see if you are due a tax refund of any overpaid taxes from the previous four years, and if you are – call our friendly team on 0330 122 9972 and let’s get that money back where it belongs.

What are the basics for freelancers and contractors?

To put it simply, if you are a freelancer or a contractor and you have earnings from any particular tax year, you will need to use the HMRC self-assessment system to file a tax return so that HMRC can calculate any tax you might owe.

You will need to contact HMRC so they can provide you with a UTR (Unique Taxpayer Reference) number – without this, you can’t use the self-assessment system. Make sure you apply in plenty of time because if you miss the filing deadline of the 31st of January, you could end up on the receiving end of a HMRC penalty.

What you need to do for your self-assessment tax return?

Your first important task, when it comes to sorting out your tax return, is keeping good business records. You will need these to fill in your tax return and HMRC can get pretty heavy if you don’t keep adequate business records. It makes good sense for you too – the better your records, the easier your self-assessment tax return is likely to be.

As well as tracking your income as a freelancer, you will also need to keep an eye on your expenses – some of those will be classed as “allowable expenses” and you will be able to claim tax relief on those. You will have to prove you have incurred the expenses in the first place though and that is where your financial record keeping should come to your rescue, with receipts and mileage expenses and so on.

What are payments on account?

If you have never worked as a freelancer or contractor before, you might be unaware of payments on account. Basically, based on how much tax you owe in this tax year, HMRC will estimate how much you are likely to owe next year and will ask you to make payments in advance on this. There are two payment dates of 31st of January and 31st of July, and you will be asked to make a payment of 50% of your tax bill each time. If you end up paying too much, HMRC will refund you that overpayment.

How can DSR Tax Claims help?

Because we know how complicated it can get when you are filing tax returns as a freelancer or contractor, our tax preparation specialists at DSR Tax Claims are able to file your self-assessment return on your behalf. Due to our expert knowledge of HMRC regulations, we can make sure that you only pay the tax you are supposed to pay and not a penny more. We can also ensure that you claim your maximum tax relief on any allowable expenses. Call our professional team on 0330 122 9972 and let us make easy work of your taxes.

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