Self assessment for freelance writers

What is self assessment?

Self assessment is a system used by HM Revenue and Customs (HMRC) to collect income tax. Unlike employees who have their taxes automatically deducted from their wages, freelancers and self-employed individuals must report their income and calculate their own tax liability. This process involves submitting a self-assessment tax return, typically by the 31st of January each year, to cover the previous tax year.

Why freelance writers need to file a self assessment

As a freelance writer, you're considered self-employed, which means you are responsible for managing your taxes. This includes declaring all your earnings, even if you also have income from employment. Failing to file your self-assessment on time or accurately can result in penalties, so it's crucial to understand your obligations.

Key steps in filing your self assessment

1. Register for self assessment:
   The first step is to register with HMRC as self-employed. You'll receive a Unique Taxpayer Reference (UTR) number, which you'll need for all your tax-related correspondence. It's important to register as soon as possible to avoid any delays or penalties.

2. Keep accurate records:
   Throughout the year, maintain detailed records of your income and expenses. This includes invoices, receipts, bank statements, and any other documents that can support your earnings and expenditures. Accurate record-keeping is essential for completing your tax return accurately and claiming any allowable expenses.

3. Understand allowable expenses:
   As a freelance writer, you can deduct certain business expenses from your income, reducing your overall tax liability. Common allowable expenses include office supplies, phone bills, professional memberships and subscriptions, travel expenses and any marketing costs. Knowing which expenses you can claim will help you save money on your tax bill.

4. Complete your tax return:
   Once you've gathered all your records, it's time to fill out your tax return. HMRC offers an online service that guides you through the process. You'll need to provide details of your income, expenses, and any other relevant information. The online system will calculate your tax liability based on the information you provide.

5. Pay your tax bill:
   After submitting your tax return, HMRC will inform you of the amount you owe. This needs to be paid by the 31st of January following the end of the tax year. You may also need to make payments on account, which are advance payments towards your next year's tax bill.

Common pitfalls to avoid

• Missing the deadline:
  The self-assessment deadline is strict. Missing it can result in automatic penalties, so make sure to submit your return on time.

• Inaccurate information:
  Providing incorrect information, whether intentional or not, can lead to fines. Double-check all entries before submitting your tax return.

• Overlooking allowable expenses:
  Failing to claim all allowable expenses can result in paying more tax than necessary. Keep a comprehensive list of your expenses and ensure you claim everything you're entitled to.

How we can help

Filing your self assessment doesn't have to be a headache. Our service simplifies the process, guiding you through every step with a personalised approach tailored to your unique tax situation. For just £9.99, our questionnaire will generate a step-by-step guide, making your self-assessment as straightforward as possible.

Start today and take the stress out of tax season. With our help, you can focus on what you do best – writing – while we handle the complexities of your self-assessment.