Key tax dates for freelancers and sole traders

New to self-employment? You’ll need to get familiar with some key dates to keep your taxes in order. 

Let’s take a look.

UK tax year dates – when does the tax year start and end?

The financial year – also called the tax year – runs from 6th April to 5th April the following year. So for 2021-2022, it’ll run from 6th April 2021 – 5th April 2022. 

Registering for Self Assessment

  • 5th October

All self-employed people (who earn over £1,000/year) need to file a tax return. To be able to do this, you first need to register for Self Assessment (that’s the HMRC system you’ll use to do your tax return).

You have to register by no later than 5th October in your second year of trading (or in other words, being self-employed). 

Top tip: When you register as self-employed you’ll get a Unique Taxpayer Reference number (UTR number) through the post. You’ll need this for all your tax returns going forward, so make sure to keep a record of it. 

Here’s how to register as self-employed.

Self Assessment (tax return) deadlines

  • 31st October for paper returns (by post)
  • 31st January for online returns 

You don’t need to wait until the deadline to file your return, though. You can do this any time from 6th April (the start of the new financial year).

We’d always recommend doing your Self Assessment earlier rather than later. Here’s why

Top tip: You can file your Self Assessment earlier in the year, but not pay the actual bill until later (as long as you pay by the deadline – see below).

Deadline to pay your tax bill

  • 31st January 

Whether you do your tax return online or by post, you need to pay your bill by 31st January. 

If you miss the deadline for your Self Assessment or paying your bill, you could get a penalty. You can read more about HMRC’s missed deadline penalty system here.

Payments on account

  • 31st January
  • 31st July

When you’re self-employed, you need to make ‘payments on account’ towards your tax bill for the following year. 

Your payments on account are two payments made on the above dates. Each one is half the value of your tax bill for the previous year. Think of these like payments in advance. After you pay your first ever tax bill, you’ll start paying ahead for your future tax bills. 

Here’s an example:

If your first ever tax bill is for the financial year 2021/2022, the deadline to pay this is January 31st 2023. But you’ll also have to pay half of what your tax bill is again on that date (as a payment towards your next tax bill). Then you’ll need to pay the other half by July 31st 2023.

So if your tax bill for 2021/2022 is, let’s say, £6000, you’ll need to pay:

  • £9000 (£6000 + £3000) by January 31st 2023 
  • £3000 by July 31st 2022

This is HMRC’s way of collecting tax in advance – technically they don’t know what your future tax bills will cost, but they use your existing one as a ballpark figure. If it turns out your next tax bill is more or less than this, you’ll either pay the difference or get a refund.

Making amends to your tax return

If you notice you’ve made a mistake on your tax return, you have up until the 31st of January the following financial year to tell HMRC. 

If you submitted an online tax return, that would be exactly 12 months after the 31st January deadline. 

If you submitted a tax return by post, that would be 15 months on from the 31st October deadline. 

How to keep on top of your taxes

Keeping on top of your taxes so you don’t miss any of these all-important deadlines is all about being proactive and getting organised. Our software is designed to make it easy to track your finances across the year – zero spreadsheets required. By connecting your bank account (or accounts), you’re able to track and tag your income and expense transactions in real time, and automate a bunch of this too. You’ll also get you a live estimate of your tax bill so there are no nasty surprises. 

Find out more >

For more helpful articles, click the link below