H M Revenue & Customs (HMRC) issues Income Tax Returns to individuals in the following circumstances:
- To individuals with complicated tax affairs,
- To individuals who are self-employed, if trading as a partnership the business will also be issued with a Return,
- To individuals who receive income from either land or property, even if you make a loss on your rental income, it should still be declared,
- To individuals who receive income from overseas,
- To individuals who receive income without tax being deducted at source.
If you are issued with a notice to complete an Income Tax Return, you must declare all income the you received during the tax year in question; even if some of it has been taxed at source i.e. Pay As You Earn (PAYE).
If you have not been issued with a notice to complete an Income Tax Return but believe that you fall into any of the above categories above you should notify HMRC that you wish to complete a Return.
The UK system of tax declaration is called Self-Assessment, the purpose of which is to put the responsibility of reporting on the tax payer, it is the tax payer’s duty to “self-assess”. Should HMRC become aware of any income received and remains undeclared, you could incur a series of penalties and interest for each year that you did not self-assess.