What is self assessment tax?

What is Self-Assessment Tax?

Self-assessment tax is a system where individuals and businesses calculate and report their own tax liabilities to the government, rather than having the tax authority calculate it for them. Taxpayers are required to file a tax return, detailing their income, deductions, and any other relevant financial information, and determine the amount of tax owed.

How It Works:

• Filing: Taxpayers submit a tax return annually, reporting their income, expenses, and applicable deductions.
• Payment: After submitting the return, the taxpayer either pays any owed tax or receives a refund if too much has been paid.
• Tax Authority's Role: The tax authority reviews the return, ensuring the information is accurate. If discrepancies arise, audits or penalties may follow.

Who Needs to File:

• Self-employed individuals
• Those with multiple sources of income (e.g., investments, rental income)
• Higher earners
• Investors, landlords, and people with complex financial situations

Click here for the steps to pay the Self Assessment tax online.

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