Who Needs to Do Self Assessment?

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If you earn money outside regular employment, you may need to complete a Self Assessment tax return and report your income to HM Revenue and Customs (HMRC). This applies to many self-employed people, sole traders, landlords and individuals with other types of income that are not fully taxed through PAYE.

However, not everyone who earns extra money needs to register for Self Assessment, and being self-employed does not automatically mean you have to submit a tax return in every situation. The rules depend on how much you earn, the type of income you receive and your personal circumstances.

In this guide, we explain who needs to complete a Self Assessment tax return, whether you can be self-employed without registering and how late you can file your tax return in the UK.

Who needs to do Self Assessment?

You will generally need to complete a Self Assessment tax return if you were self-employed as a sole trader and your total gross trading income was more than £1,000 during the tax year. Gross income means the total amount you received before deducting business expenses, rather than the profit you made after paying for business costs.

For example, if you earned £8,000 from your gardening business and spent £2,000 on equipment, fuel and other allowable expenses, your gross income would be £8,000, even though your profit was only £6,000. Because your gross trading income exceeds £1,000, you would normally need to register for Self Assessment and report your business income to HMRC.

You may also need to complete a tax return if you receive rental income, have taxable foreign income, earn dividends or savings interest that needs to be reported, or have other income that is not fully taxed at source. Other circumstances can also require a tax return, including certain Capital Gains Tax liabilities and the High Income Child Benefit Charge.

If you work for an employer and pay tax through PAYE, you do not normally need to complete a tax return just because you have a job. However, if you also run a small business, rent out property or receive other taxable income, you should check whether you have an additional reporting obligation.

You can read our guide on how much you can earn when self-employed before doing a tax return for more information about the £1,000 trading allowance and how it works.

Can you be self-employed without registering?

Yes, you can be self-employed without registering with HMRC in certain circumstances, particularly if you have only a small amount of trading income.

If your total gross trading income from self-employment is £1,000 or less during a tax year, you will generally not need to register for Self Assessment or declare that income to HMRC. This is because of the £1,000 trading allowance, which can cover income from activities such as freelance work, occasional gardening jobs, selling handmade products or providing other casual services.

For example, if you earn £700 from occasional freelance work during the tax year and have no other reason to submit a tax return, you will normally not need to register for Self Assessment just because of that income.

However, the £1,000 threshold is based on your gross income, not your profit. If you receive £1,500 from your business but spend £800 on business expenses, your gross income is still £1,500, so you will generally need to register even though your profit is only £700.

There are also situations where you might choose to register even if your income is below £1,000, such as when you want to claim certain tax reliefs, report a business loss or establish evidence that you are self-employed for a particular purpose.

If your trading income exceeds £1,000, you should normally register for Self Assessment and notify HMRC that you need to report your income. You can find out how to do this in our guide to registering for Self Assessment as a sole trader.

Remember that registering for Self Assessment is not the same as registering a limited company with Companies House. If you operate as a sole trader, you do not normally need to register a business with Companies House, but you may still have to register with HMRC for tax purposes.

How late can you file tax return in the UK?

The deadline for filing a Self Assessment tax return depends on whether you submit it online or on paper, and missing the deadline can lead to penalties even if you do not owe any tax.

For the 2025/26 tax year, which ran from 6 April 2025 to 5 April 2026, the main deadlines are:

• 5 October 2026: The deadline for telling HMRC that you need to complete a tax return if you are new to Self Assessment or meet the relevant re-registration conditions.
• 31 October 2026: The deadline for submitting a paper tax return.
• 31 January 2027: The deadline for submitting an online tax return and paying the tax due.

If you submit your return online, you normally have until midnight on 31 January following the end of the tax year. For example, your online tax return for the 2025/26 tax year must normally be submitted by midnight on 31 January 2027.

If you are submitting a paper return, the deadline is earlier, on 31 October 2026. Most taxpayers therefore choose to file online, as it gives them more time and allows them to submit their return directly to HMRC.

If HMRC issues your tax return late, you may have a different filing deadline. You should check the date stated in HMRC’s letter or online account rather than automatically assuming the standard deadline applies.

What happens if you file your tax return late?

If you miss the filing deadline, HMRC will normally issue an initial £100 late-filing penalty, even if you have no tax to pay.

If your return remains outstanding, further penalties may apply. After three months, daily penalties of £10 can be charged for up to 90 days, potentially adding another £900. After six months, a further penalty of 5% of the tax due or £300, whichever is greater, may apply. Another penalty of 5% of the tax due or £300, whichever is greater, may apply after 12 months.

These penalties are separate from charges for paying your tax late. If you owe tax and do not pay it by the payment deadline, HMRC may charge interest and late-payment penalties as well.

For example, if you miss the 31 January 2027 online filing deadline for the 2025/26 tax return, you will normally receive an initial £100 penalty. If you continue to delay submitting the return, the amount you owe in penalties can increase considerably.

If you have a reasonable excuse for missing the deadline, you may be able to appeal against a penalty, but HMRC will consider the circumstances before deciding whether to cancel it.

What should you do if you have not registered or filed a tax return?

If you have been self-employed but have not registered with HMRC, it is important to check whether you should have registered for an earlier tax year and whether you have any outstanding tax returns.

You should not assume that you do not need to report your income simply because you have already paid tax through employment, because income from self-employment and other sources may still need to be declared separately.

Start by gathering your business income records, invoices, bank statements and receipts for allowable expenses. You can then work out your income and expenses for each tax year and establish which returns, if any, need to be submitted.

If you have missed a deadline, it is generally sensible to deal with the outstanding return as soon as possible rather than waiting for HMRC to contact you. Where several tax years are involved, or you are unsure how to report the income correctly, an accountant can help you review your position and deal with HMRC on your behalf where authorised.

Need help with your Self Assessment tax return?

At Better Account, we help self-employed people and small business owners understand their tax obligations, prepare their accounts and submit Self Assessment tax returns to HMRC.

Whether you are registering as a sole trader for the first time, filing a tax return for an existing business or dealing with an overdue return, getting the right support can help you meet your obligations and avoid unnecessary mistakes.

If you would like help with your Self Assessment tax return, contact Better Account to discuss your circumstances and the support you need.

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