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Most employees whose tax affairs are fully dealt with through PAYE will not need to complete a Self-Assessment tax return. However, HMRC can require any taxpayer to file a return, and there are a number of circumstances in which an individual is obliged to do so. The main situations that lead to the obligation to file a tax return are as follows.
Income from Self-Employment or Partnerships
An individual who is self-employed or who is a partner in a partnership must file a Self-Assessment return. Each partner is individually responsible for reporting and paying tax on their share of the partnership profits. However, where an individual’s total receipts from self-employment are £1,000 or less in a tax year, they may qualify for the trading income allowance and will generally not need to file a return in respect of that income. However, there are exceptions, for example where the individual wishes to pay voluntary Class 2 National Insurance contributions, preserve a record of self-employment, or claim Tax-Free Childcare.
High Total Income
Employees with total income exceeding £150,000 are required to file a Self-Assessment return.
Untaxed Income
Individuals receiving untaxed income of £2,500 or more must file a return. State Pension is excluded from this threshold where it is being collected through the PAYE tax code (which is the most common scenario). Common examples of untaxed income include bank interest (UK or foreign), life insurance gains, and casual earnings not taxed through PAYE.
Property and Rental Income
A return is needed where an individual receives income from the letting of property or land that exceeds £10,000 gross, or where the net amount (after allowable expenses) is more than £2,500.
Non-Resident Landlords
Non-UK resident landlords with UK rental income are required to file Self-Assessment returns.
Capital Gains Tax
An individual who has Capital Gains Tax to pay after the annual exempt amount (and has not already reported the gain through the Capital Gains Real Time Transaction service) must file a return. This may arise, for example, on the sale of shares or the sale of a residential property that is not the individual’s main home. In the case of UK residential property disposals, a separate Capital Gains Tax return must also be filed within 60 days of completion.
High Income Child Benefit Charge
Where an individual or their partner receives Child Benefit and the individual has adjusted net income of £60,000 or more, the individual with the higher income is liable to the High Income Child Benefit Charge. From 2024–25 onwards, an individual only needs to register for Self-Assessment for this reason if they choose not to pay the charge via PAYE.
Savings, Investment, and Dividend Income
A return is needed where an individual receives savings or investment income of £10,000 or more before tax, or dividend income of £10,000 or more before tax.
Foreign Income
UK residents with foreign income or capital gains generally need to file a Self-Assessment return. This includes foreign interest, even if the amount is small or has already been taxed abroad. However, a return is not needed if the only foreign income consists of dividends covered by the dividend allowance (currently £500) and there is nothing else to report.
Employment-Related Expenses
If an employee wishes to claim a deduction for employment-related expenses of £2,500 or more, a Self-Assessment return is required.
Trust, Settlement, or Estate Income
An individual who receives (or is treated as receiving) income from a trust, settlement, or the estate of a deceased person, and further tax is due on that income, must file a return.
Unauthorised Pension Payments
Receiving unauthorised payments from a pension scheme that are liable to a tax charge triggers a filing obligation.
Annual Allowance Pension Charge
Individuals with an annual allowance pension charge are required to file a Self-Assessment return. This charge arises where total pension savings in a tax year exceed the individual’s available annual allowance. The standard annual allowance is currently £60,000, although it may be reduced for high earners through the tapered annual allowance, or restricted by the money purchase annual allowance where the individual has flexibly accessed pension benefits.
Tax Relief Claims
A return may be needed where an individual claims certain reliefs, including Enterprise Investment Scheme Relief or Seed Enterprise Investment Scheme Relief, where the relief claimed for each item is £10,000 or more.
Specific Occupations and Statuses
Certain categories of individual are automatically required to file, including ministers of religion (of any faith or denomination), share fishermen, and members at Lloyd’s.
Notification of Chargeability
Any individual who has not received a notice to file a tax return from HMRC but has received untaxed income or made a capital gain during the tax year is required to notify HMRC of their chargeability by 5 October following the end of the tax year. For example, by 5 October 2026 for income or gains arising in the year ended 5 April 2026.
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