‍We all learn differently. Some learn by doing, others by watching, and others by replicating. So what if you’re just setting out to file your first sole trader tax return, known as a Self Assessment, and you want to see an example of one to help you on your way?

Well, at Crunch, we file thousands of these things every year on behalf of our clients. Self Assessments are the biggest self-employed tax filings of the year, and one of the key areas our clients ask for support with.

After all, getting them wrong can lead to some fairly serious consequences with the taxman, so it’s always better to know you’ve got the job done right when it comes to Self Assessment season.

So, what does a sole trader tax return look like, and what are the best examples and guides to follow to make sure that your tax return is as smooth as possible this year? Let’s discuss.

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What does a sole trader tax return look like?

A sole trader tax return – known as a Self Assessment or SA100 – can come in different forms. You can either order a paper copy of the form from HMRC, or you can fill them out online. Of the two options, we always recommend filing online.

Below is an example of the paper Self Assessment:

The online form is a much-less intimidating series of boxes, the likes of which you’ll have seen a thousand times on the internet. They’ll ask for things like your first and last names, your Unique Taxpayer Reference and National Insurance Number, before moving on to your business information and your income.

It’s much more streamlined and easier to comprehend than the paper copy.

Why do Crunch recommend online Self Assessment filings?

There’s two main reasons: number one is the easy and convenience of filing online compared to paper filing, and number two is the government’s ‘Making Tax Digital’ scheme.

The online form is split into much more digestible chunks than the paper form, and it’s far more convenient to fill in than the paper form. Not to mention, if you misspell something on your digital form, deleting and retyping is far more convenient and self-assuring than the permanence of pen and ink.

As for Making Tax Digital, this is the government’s scheme to move all major UK tax filings online. The aim is to make HMRC one of the most efficient tax organisations in the world, and many parts of the UK’s tax system have already shifted online.

Not only are you saving yourself a ton of hassle filing online, but you’re shifting to the new all-digital age with plenty of time to spare. Better to get ahead of the curve than be dragged round it by HMRC, right?

How to complete a sole trader tax return

Here are the major documents you need to keep in order to file an accurate sole trader Self Assessment:

• Any information relating to sales and income.
• A record of every business expense you intend to claim.
• All VAT records, assuming you’re VAT registered.
• PAYE records, assuming you have employees.
• All personal income records.
• Records relating to the Self-Employed Income Support Scheme (SEISS), if you claimed this grant during the COVID-19 pandemic.

HMRC recommends that you keep a record of all these documents for at least five years after your last Self Assessment submission. As an example, all documents submitted for your January 2024 Self Assessment should be retained until January 2029.

Everything on the online Self Assessment document is fairly self-explanatory, so if you’re planning on filing your return yourself, you shouldn’t run into too much trouble as you work your way through the document.

That being said, we highly recommend getting an expert to help you file your Self Assessment – or to simply do it for you.

Why do Crunch recommend getting an accountant to file sole trader tax returns?

Your Self Assessment is the most important tax filing as a sole trader; any inaccuracies could leave you paying more tax than necessary or saddle you with a hefty fine from HMRC. And that’s why accountants are worth their weight in gold.

These tax filings are their bread and butter; they’ve filed more of these things than most of us have had hot dinners. In fact, around 12 million people file a Self Assessment each year, with many of them submitted by professional accountants.

There’s no legal requirement to file your tax return through an accountant, but the benefits speak for themselves. Here at Crunch, we offer Self Assessment filings as part of our paid Sole Trader accountancy package.

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When do I need to submit my sole trader tax return?

The Self Assessment deadline is January 31^st each year. The earliest you can file your Self Assessment is April 7^th – one day after the new tax year. While we don’t expect anyone to be that organised, we would recommend filing your Self Assessment as early as possible to avoid any concerns in January.

If you miss the January deadline, you’ll be subject to a late filing penalty. Further fines will follow if you don’t file as soon as possible, which we document in more detail in our fines and penalties article.

Other frequently asked questions about Self Assessment

1. When do I need to register?

If you need to complete a Self Assessment tax return for the first time, you need to let HMRC know by October 5th. You can do this online, by phoning HMRC or by completing a form and posting it to HMRC directly. 

2. Do I need to file a tax return if HMRC hasn’t contacted me?

Yes, it’s your responsibility to determine if you need to complete a Self Assessment tax return. Even if HMRC hasn’t reached out to you, you may still need to file a return.

This could be necessary if you:

• Are self-employed with gross income exceeding £1,000.
• Earned less than £1,000 but want to voluntarily pay Class 2 National Insurance Contributions.
• Are a new partner in a business partnership.
• Earn over £150,000 in taxable income.
• Receive Child Benefit payments and you or your partner’s income is over £60,000 and requires paying the High Income Child Benefit Charge. 

If you’re not sure whether you need to file or not, you can use HMRC’s free tool to check. 

3. Do I have to pay my tax bill when I file my Self Assessment tax return?

No, even if someone filed in October, the deadline to pay any tax owed is 31st of January. However, you can set up a Budget Payment Plan to spread the costs of your tax bill through regular payments which can help you manage your finances better.

4. Do I need to file a return if I don’t owe any tax?

Yes, you may still need to file a Self Assessment tax return even if you don’t owe any tax. Some examples of why it might be necessary include if you are:

• Claiming a tax refund,
• Claiming relief on business expenses, charitable donations, or pension contributions,
• Or if you want to pay voluntary Class 2 National Insurance Contributions to maintain your eligibility for certain benefits and State Pension.

5. Will HMRC automatically deregister me as Self Employed if I no longer need to file a tax return?

No, you need to inform HMRC if your circumstances change and you think you no longer need to submit a Self Assessment tax return. If you’ve received a notice from HMRC to file, it’s crucial to update them to avoid receiving further reminders or potential penalties. 

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How Crunch can help

If you’re interested in employing the services of a professional accountant to manage your sole trader Self Assessment for you, talk to Crunch!

When you sign up to a CrunchONE for Sole Traders accountancy package, your first Self Assessment submission with us is completely free of charge. From then on, we can take the stress and complexity of Self Assessment submission of your hands for as little at £140+VAT. 

All you need to do is upload your documents to the software, and we’ll take care of the rest!

For more information, head over to our Pricing page, or give one of our friendly experts a call for a free consultation.

For more information about Crunch’s accountancy packages, check out our Pricing page, or give one of our friendly Sales team a call for a free consultation.