UK Tax Filing Requirements
Please note that this article provides an overview of the filing requirements for UK tax returns. It should not be used as advice for an individual’s filing requirements. This article is for educational purposes only.
Unlike US tax return filing requirements, which are relatively simple, UK tax filing requirements can be more complex, making it unclear for individuals whether they have a filing requirement at all. In this article, we will address some of the most common filing requirements.
Income Exceeds £150,000 (previously £100,000)
When a taxpayer’s income exceeds £100,000, they begin to lose their personal allowance. As such, the tax code on their employment income must be accurate to ensure the correct amount of tax is withheld at source. Historically, this also triggered a tax filing requirement. However, with effect from 6 April 2023 (i.e., for the 2023/24 tax year onwards), a tax return filing is only required if income exceeds £150,000. You may still need to file if you have other requirements listed below.
Investment income
There are generally three types of investment income: interest, dividends, and capital gains. Taxpayers have a filing requirement if their investment income exceeds the relevant tax-free allowances. These allowances can be found on HMRC’s website:
- Interest: https://www.gov.uk/apply-tax-free-interest-on-savings
- Dividends: https://www.gov.uk/tax-on-dividends
- Capital Gains: https://www.gov.uk/capital-gains-tax/allowances
Please note that the "personal savings allowance" for interest income is removed for additional rate taxpayers (i.e., those with taxable income of £125,141 or more).
Rental Income
If a taxpayer has rental property, they generally have a filing requirement if their gross income exceeds £1,000 per year. This is due to the income exceeding the property allowance for the year. There are more specific details, but this is the general threshold to avoid potential issues with HMRC.
Self-employment income
Similarly to rental income, if a taxpayer’s self-employment income exceeds £1,000, there is a filing requirement, as this exceeds the trading allowance.
Partnership income
Partners in a business partnership generally have a filing requirement, regardless of the share of income or capital gains allocated to them.
High Income Child Benefit Charge
If you or your partner receive Child Benefit and your income is over £60,000 (£50,000 up to 2023/24), there is a general requirement to file a return to pay this charge.
Foreign income
Taxpayers generally have a filing requirement if they have received taxable foreign income (e.g., dividends over the tax-free allowance). Please note that taxpayers still need to file a UK tax return to claim the remittance basis election (this must be claimed if the foreign income is over £2,000).
These are the most common ways filing requirements arise, but please note there are numerous other requirements. As such, we recommend getting in touch if you are unsure of your obligations.
Registering for Self-Assessment
If you need to file a tax return, you are required to inform HMRC by 5 October after the end of the tax year that you have a filing requirement. You can register to file here: https://www.gov.uk/register-for-self-assessment
Unlike US tax return filing requirements, which are relatively simple, UK tax filing requirements can be more complex, making it unclear for individuals whether they have a filing requirement at all. In this article, we will address some of the most common filing requirements.
Income Exceeds £150,000 (previously £100,000)
When a taxpayer’s income exceeds £100,000, they begin to lose their personal allowance. As such, the tax code on their employment income must be accurate to ensure the correct amount of tax is withheld at source. Historically, this also triggered a tax filing requirement. However, with effect from 6 April 2023 (i.e., for the 2023/24 tax year onwards), a tax return filing is only required if income exceeds £150,000. You may still need to file if you have other requirements listed below.
Investment income
There are generally three types of investment income: interest, dividends, and capital gains. Taxpayers have a filing requirement if their investment income exceeds the relevant tax-free allowances. These allowances can be found on HMRC’s website:
- Interest: https://www.gov.uk/apply-tax-free-interest-on-savings
- Dividends: https://www.gov.uk/tax-on-dividends
- Capital Gains: https://www.gov.uk/capital-gains-tax/allowances
Please note that the "personal savings allowance" for interest income is removed for additional rate taxpayers (i.e., those with taxable income of £125,141 or more).
Rental Income
If a taxpayer has rental property, they generally have a filing requirement if their gross income exceeds £1,000 per year. This is due to the income exceeding the property allowance for the year. There are more specific details, but this is the general threshold to avoid potential issues with HMRC.
Self-employment income
Similarly to rental income, if a taxpayer’s self-employment income exceeds £1,000, there is a filing requirement, as this exceeds the trading allowance.
Partnership income
Partners in a business partnership generally have a filing requirement, regardless of the share of income or capital gains allocated to them.
High Income Child Benefit Charge
If you or your partner receive Child Benefit and your income is over £60,000 (£50,000 up to 2023/24), there is a general requirement to file a return to pay this charge.
Foreign income
Taxpayers generally have a filing requirement if they have received taxable foreign income (e.g., dividends over the tax-free allowance). Please note that taxpayers still need to file a UK tax return to claim the remittance basis election (this must be claimed if the foreign income is over £2,000).
These are the most common ways filing requirements arise, but please note there are numerous other requirements. As such, we recommend getting in touch if you are unsure of your obligations.
Registering for Self-Assessment
If you need to file a tax return, you are required to inform HMRC by 5 October after the end of the tax year that you have a filing requirement. You can register to file here: https://www.gov.uk/register-for-self-assessment
Our motto: "Never ignore a letter from the IRS (or HMRC)"