Are Self-Assessment and Tax Return the Same?

If you're a UK resident trying to get your head around taxes, chances are you've come across two frequently used terms—self-assessment and tax return. Often used interchangeably, these terms can create confusion for individuals, especially first-time filers, freelancers, landlords, or even company directors.

But are self-assessment and tax return the same thing? The short answer: not quite.

While the two terms are closely related and intertwined in the UK tax system, they refer to different parts of the same process. Understanding the distinction between them is essential for staying compliant with HMRC (Her Majesty's Revenue and Customs), avoiding penalties, and ensuring that you’re paying the correct amount of tax.

In this blog, we’ll break down both terms, explore their differences and connections, and help you understand where you fit into the system.

What is a Tax Return?

A tax return is a formal document or digital form submitted to HMRC that provides details of your income, expenses, and other financial information for a specific tax year. The purpose is to calculate how much tax you owe—or how much you’re owed in refunds.

There are various types of tax returns in the UK, including:

• Self Assessment tax return (SA100)

• Corporation tax return (CT600)

• VAT returns

• PAYE returns (for employers)

In the context of individuals and sole traders, a Self Assessment tax return is the most common.

What is Self-Assessment?

Self Assessment is the system used by HMRC to collect Income Tax from people whose income is not automatically taxed through PAYE (Pay As You Earn). This includes:

• Self-employed individuals

• Partners in a business partnership

• Landlords with rental income

• People with overseas income

• Individuals with complex tax affairs

• Company directors with untaxed income

In simple terms, Self Assessment is the process, while the tax return is the actual document or form you submit.

Key Differences Between Self-Assessment and Tax Return

Why the Confusion?

The confusion arises because Self Assessment and tax return go hand in hand. One cannot exist without the other if you fall under the criteria. Here’s an analogy to help you understand:

Think of Self Assessment as a university course you enroll in. The tax return is like your final exam—a requirement to complete the course.

Do You Need to File a Tax Return?

Not everyone in the UK needs to file a tax return. Most employees have taxes deducted from their salary under the PAYE system. However, you must file a tax return under Self Assessment if you fall into any of the following categories:

• You earned more than £1,000 from self-employment.

• You received untaxed income (e.g., rental, dividends, foreign income).

• You are a company director (except for non-profit organisations).

• You earned over £100,000 in income.

• You need to claim certain tax reliefs or expenses.

• You’re subject to the High-Income Child Benefit Tax Charge.

• You made capital gains.

Failing to file a required tax return can result in hefty penalties and interest charges.

How Do Self Assessment and Tax Returns Work Together?

The process typically follows these steps:

1. Registration for Self Assessment:
   You must first notify HMRC that you need to use Self Assessment. This is done online and is necessary for new filers.

2. Receiving UTR Number:
   Once registered, HMRC assigns you a Unique Taxpayer Reference (UTR), which is used for all future tax filings.

3. Completing the Tax Return Form (SA100):
   Each year, you'll fill out the tax return form covering income, expenses, and other financial data.

4. Submission Deadline:

   • 31 October for paper returns

   • 31 January for online submissions

5. Tax Payment:
   The payment deadline is also 31 January, with a potential second payment on account due by 31 July.

Common Mistakes in Self Assessment and Tax Return

• Missing the Deadline: Late submissions attract an automatic £100 penalty, even if no tax is owed.

• Incorrect Information: Misreporting figures can lead to audits or fines.

• Not Registering in Time: You must register by 5 October after the tax year ends.

• Ignoring Payment on Account: If your tax bill exceeds £1,000, HMRC may require advance payments for the next tax year.

Benefits of Understanding the Difference

Knowing that self-assessment and tax return are not the same helps:

• Avoid confusion with deadlines and responsibilities

• Ensure timely registration and submission

• Prevent penalties due to misunderstanding

• Enable better tax planning and budgeting

Who is Exempt from Self Assessment?

Some people think they need to file a return when they actually don’t. For instance:

• Employees with only PAYE income

• Pensioners with income under the personal allowance

• Those with minor untaxed income (under £1,000 "trading allowance")

If in doubt, HMRC’s online tool can help you check whether you need to file.

Digital Transformation of Self Assessment

HMRC has been pushing its Making Tax Digital (MTD) initiative, aiming to modernize how tax is reported and collected. While MTD currently applies mainly to VAT-registered businesses, it is expected to extend to Income Tax Self Assessment (ITSA) in the near future.

Keeping accurate digital records and using HMRC-compliant software will soon be mandatory for many taxpayers.

Professional Help vs. DIY

You can file your own tax return if your finances are straightforward. However, using a tax professional offers several advantages:

• Accurate submissions

• Deductions you might miss

• Time-saving

• Peace of mind

If you’re self-employed, a landlord, or have multiple income streams, professional assistance can make a significant difference.

Final Thoughts

So, are Self Assessment and tax return the same?
No—they are different but connected parts of the UK tax system.

• Self Assessment is the process by which HMRC collects Income Tax from individuals whose income isn’t taxed automatically.

• A tax return is the form that reports your income and is submitted as part of the Self Assessment process.

Understanding both concepts is vital to managing your tax obligations, avoiding penalties, and staying on the right side of the law. Whether you’re self-employed, a landlord, or have complex income, taking the time to understand your responsibilities will pay off in peace of mind and financial stability.

FAQs About Self Assessment and Tax Returns

1. Do I need to register for Self Assessment every year?

No. Once you are registered and have a UTR, you do not need to register again unless your circumstances change and you stopped filing for a while.

2. Can I be under PAYE and still need to file a tax return?

Yes. If you have additional income (e.g., property or dividends), you may still need to file a tax return even if you are taxed under PAYE.

3. Is it mandatory to file a Self Assessment tax return online?

No, you can still file a paper return, but the deadline is earlier (31 October). Online filing gives you more time and is generally easier.

4. What happens if I file my tax return late?

You’ll face a £100 fixed penalty initially. Additional penalties apply after 3, 6, and 12 months. Interest may also be charged on unpaid tax.

5. Can I amend my tax return after submission?

Yes. You can amend your return online within 12 months of the filing deadline.

6. What if I no longer need to file a Self Assessment return?

You must notify HMRC so they can remove you from the Self Assessment system. Failing to do so may result in penalties for not filing.

For a smooth, stress-free tax season, always keep accurate records, understand your obligations, and seek help if your financial situation is complex.