Are you ready for changes to the Self-Assessment tax return criteria?

Are you ready for changes to the Self-Assessment tax return criteria?

Recent developments in the Self-Assessment tax return criteria have brought significant changes that everyone who files a tax return should be aware of.

These changes reflect HM Revenue and Customs’ (HMRC) ongoing efforts to simplify and modernise Income Tax services.

Below, we go over some of the key changes to the tax return system and how you should react to them.

Key changes

There have been three major announcements regarding the Self-Assessment criteria:

  • Raising the income threshold: The income threshold for filing a Self-Assessment tax return, assuming no other criteria are met, was increased from £100,000 to £150,000. This adjustment applies to the 2023/24 tax year. 
  • Simplifying high income child benefit charge: A written ministerial statement in July outlined plans to streamline the process for taxpayers liable for the high income child benefit charge. The Government proposed a system allowing employed taxpayers to pay this charge through their tax code, eliminating the need to register for Self-Assessment. However, further details on this proposal are still pending. 

Unchanged criteria

Despite these updates, several criteria for completing a Self-Assessment tax return remain unchanged:

  • Self-employment income over £1,000.
  • Other untaxed income of £2,500 or more.
  • Claims for tax relief on employment expenses exceeding £2,500.
  • Income from savings or investments over £10,000 (tax on amounts below this level may be collected through a PAYE coding adjustment).

If you are confused as to whether you need to file a tax return for Income Tax Self-Assessment because of the new thresholds, visit the Government website to check your eligibility.

Alternatively, please get in touch with one of our team to discuss your tax liabilities and filing process.

Looking forward

As HMRC plans further changes in its digital services and operational processes, the landscape of Self-Assessment is poised for more transformation.

Understanding these changes is crucial for taxpayers to remain compliant and navigate the evolving tax landscape effectively so please keep an eye on further updates from HMRC and stay informed and prepared by communicating with your accountant.

If you are concerned about any of the issues raised by changes to the Self-Assessment criteria, please do not hesitate to get in touch with one of our team.