Filing Your First Self‎-Assessment? Here’s What You Need to Know 

If you’ve just started working for yourself — whether full-time or on the side — welcome to the world of self-employment. One of the first responsibilities you’ll face is filing your self-assessment tax return. 

If this is your first time self assessment, it’s completely normal to feel overwhelmed. But rest assured — with some early preparation and clarity, the process becomes far more manageable than it seems. 

This guide will walk you through every step, including registering with HMRC, filing online, claiming deductions, and avoiding mistakes. It’s written especially for new freelancers and sole traders navigating their first tax return in the UK. 

What Is a Self-Assessment Tax Return? 

A self-assessment is how you report your income to HM Revenue & Customs (HMRC) and pay any Income Tax and National Insurance contributions owed. 

In most cases, employees have their tax deducted at source through PAYE. But if you’re self-employed, work as a freelancer, rent out property, or earn untaxed income, you must declare that income yourself through hm revenue & customs self assessment online. 

Self-assessment also allows you to declare other income sources, such as: 

• Dividends from investments 

• Foreign income 

• Rental income 

• Capital gains 

• Side income from platforms like Airbnb, Etsy, or Fiverr 

• Cryptocurrency trading profits 

• Earnings from digital assets and affiliate marketing 

If you’re earning from multiple streams, even on the side, it’s your legal responsibility to declare it. 

Who Needs to File a Self-Assessment Return? 

You must file if: 

• You earned over £1,000 from self-employment (even part-time) 

• You have untaxed income (e.g., from rental property, crypto, or dividends) 

• You’re a company director (excluding non-profit organisations) 

• You receive income from abroad 

• You or your partner receive Child Benefit and earn over £50,000 

• You made capital gains 

• You received COVID-19 self-employment support grants (SEISS) 

• You have multiple income sources and need to claim tax relief or business expenses 

Even if you’re employed and your employer handles your taxes through PAYE, if you have a side hustle, you’re responsible for reporting that additional income. 

Step 1: Register for Self-Assessment 

If you’re filing for the first time, you must register with HMRC by 5 October following the end of the tax year in which you began trading. The UK tax year runs from 6 April to 5 April. 

How to Register: 

1. Go to HMRC’s online registration page. 

1. Choose your category (e.g., sole trader). 

1. Fill in your personal and business details. 

1. HMRC will send you a Unique Taxpayer Reference (UTR) by post. 

1. Use this to create your HMRC Gateway ID, allowing you to access their online services. 

You may need to wait 10–15 days to receive your UTR by post, so start early. 

This ID is essential for your self assessment return online. 

 Step 2: Understand the Filing Deadlines 

You need to be aware of the following deadlines: 

• 5 October: Register with HMRC for self-assessment 

• 31 October: Paper return deadline (not recommended) 

• 31 January: Final deadline to submit your return and pay your tax 

• 31 July: Second “payment on account” deadline (if applicable) 

Missing these dates results in automatic fines — even if you owe nothing. 

If your return is more than 3 months late, you’ll receive additional penalties of £10 per day, up to 90 days. At six months late, there’s a further £300 fine or 5% of tax owed. 

Step 3: Keep Track of Income and Expenses 

Good record-keeping is the foundation of a stress-free tax return. 

What to Track: 

• Invoices and client payments 

• Bank statements 

• Cash income 

• Receipts for all business expenses 

• Mileage logs and travel receipts 

• Equipment and tool purchases 

• Online platform fees (e.g., Etsy, Uber, Fiverr) 

• Foreign currency conversions 

• Pension contributions 

• Charity donations (Gift Aid) 

Use accounting software or a spreadsheet to log each transaction as it happens. Keeping digital copies of receipts will also help with compliance under Making Tax Digital (MTD). 

Step 4: Know What Expenses You Can Claim 

The goal is to reduce your taxable income — legally. You do that by claiming allowable expenses. 

Common examples include: 

• Internet and phone bills (business portion) 

• Travel and mileage 

• Home office costs (heating, lighting, etc.) 

• Advertising and marketing 

• Website hosting or software 

• Training courses 

• Accountant fees 

• Business insurance 

• Equipment purchases under capital allowances 

• Bank charges for business accounts 

• Interest on business loans 

• Subscriptions to trade publications 

Be careful not to overclaim — only the business-use percentage is allowable. For shared items like mobile phones or Wi-Fi, only a fair business-use proportion should be entered. 

Step 5: File Your Return Online 

Once registered and prepped, it’s time to complete your self assessment tax filing online. 

Filing Process: 

1. Log into your HMRC Gateway account 

1. Enter income, expenses, and other applicable information 

1. Declare additional income: capital gains, dividends, foreign income, etc. 

1. Add pension contributions and student loan repayments if applicable 

1. Review your tax calculation 

1. Submit and pay online before 31 January 

You’ll receive a confirmation once submitted. You can also save a PDF of your return for future reference. 

You may choose to file through an accountant or tax filing service if you prefer not to handle the process yourself. 

Step 6: Avoid These Common Mistakes 

🚫 Filing Late 

Missing the deadline triggers an immediate £100 penalty. 

🚫 Not Registering in Time 

HMRC must send you a UTR and Gateway ID — don’t leave it too late. 

🚫 Guessing Income 

Even small side gigs must be accurately declared. 

🚫 Overlooking Expenses 

Many first-time filers leave money on the table by not claiming legitimate costs. 

🚫 Forgetting to Save Records 

Without documentation, you risk audits or fines. 

🚫 Not understanding “payment on account” rules 

Surprise tax bills in July can hurt your cash flow if you didn’t know they were coming. 

You can avoid all of this by working with a self assessment tax return accountant near me, especially during your first year. 

Step 7: How Much Tax Will You Owe? 

Your tax bill depends on your profit after allowable expenses. 

Income Tax Rates (2024/25): 

• £0–£12,570: 0% (Personal Allowance) 

• £12,571–£50,270: 20% 

• £50,271–£125,140: 40% 

• Over £125,140: 45% 

Plus: 

• Class 2 NIC: £3.45 per week (if profits over £6,725) 

• Class 4 NIC: 9% on profits between £12,570–£50,270, and 2% above that 

HMRC’s online calculator or a qualified accountant can help estimate your bill. 

Step 8: Making Payments on Account 

If your bill is over £1,000, HMRC may require two advance payments toward next year’s tax bill: 

• 31 January: First payment 

• 31 July: Second payment 

Each payment is 50% of your prior year’s tax bill. If your actual income drops, you can request to reduce these payments, but be cautious — underpaying without justification leads to interest charges. 

Step 9: Filing Early = Less Stress 

You don’t have to wait until January to file. As soon as the tax year ends (5 April), you can file. 

Benefits of early filing: 

• More time to save up for tax 

• Faster refunds (if due) 

• Avoid January bottlenecks 

• Peace of mind 

• Fix errors before deadlines 

• Reduce the risk of forgotten income 

• Improve your cash flow management 

Early filing also helps secure mortgages or loans, as you’ll have up-to-date proof of income. 

Step 10: Consider Hiring a Tax Expert 

Even if your situation seems simple, having expert guidance for your first return can: 

• Save you money 

• Prevent fines 

• Maximize deductions 

• Prepare you for future years 

• Help you understand payment on account and NI obligations 

• Give you a long-term tax planning strategy 

A self-assessment specialist ensures everything is submitted correctly — and gives you more confidence. 

Final Thoughts 

Filing your first self-assessment tax return doesn’t need to be overwhelming. When you break it into manageable steps — registering early, tracking your income, understanding deductions — it becomes a straightforward annual task. 

The key is to start early, stay organized, and don’t guess. If you need support, don’t hesitate to reach out to a self assessment tax return accountant near me for help — especially in your first year. 

Filing your taxes is more than compliance — it’s an opportunity to take control of your business finances, maximize deductions, and build a stronger foundation for the future. 

FAQs