High Earner Tax Returns | Self Assessment
A common question we receive is: Why do I need to file a tax return if all my income is taxed at source?
Previous Requirements
In past years, individuals with a gross income over £100,000 had to file a tax return, even if all their income was from taxable sources like employment and pensions. This threshold increased to £150,000 for the tax year 2023/24.
No Threshold for 2024/25
For the tax year 2024/25, HMRC has removed the income threshold requirement entirely. This change means that many individuals who previously had to file tax returns due to their high income might not need to do so anymore. However, you might still need to file a tax return for various other reasons, such as:
- Income from Multiple Sources: If you have additional income from self-employment, rental properties, or investments.
- Capital Gains: If you’ve sold assets and need to report capital gains.
- Tax Relief Claims: To claim tax relief on pension contributions, charitable donations, or other deductible expenses.
- Underpaid Tax: If you need to pay a balancing charge due to underpaid tax.
Ensuring Accurate Tax Payments
Even if you don’t need to file a tax return, it’s crucial to ensure that you’re paying the right amount of tax. Here are our top tips:
- Check Your Tax Code: Make sure it accurately reflects your earnings and any eligible reliefs.
- Claim All Due Reliefs: Look into pensions, professional subscriptions, expense claims, and mileage to improve your tax position.
- Gift Aid: If you make donations to charity and tick the gift aid box, you may qualify for additional tax relief.
If you’re unsure whether you need to file a tax return or if it would be beneficial to continue doing so, please get in touch with us. We can help you navigate these changes and ensure you’re compliant with HMRC requirements.
