Starting from the tax year 2023-2024, the self-assessment threshold for taxpayers taxed only through PAYE will increase from £100,000 to £150,000, as confirmed by HMRC.

For the current tax year 2022-2023, the self-assessment threshold remains at £100,000. Hence, affected taxpayers don’t need to take any action at the moment.

However, if taxpayers submit a 2022-2023 tax return that shows income between £100,000 and £150,000, which is taxed through PAYE, and they don’t meet any other criteria for submitting a self-assessment return, they will receive a self-assessment exit letter.

From the 2023-2024 tax year onwards, taxpayers will still be required to submit a tax return if their income, taxed through PAYE, is below £150,000 but they meet any of the other criteria for submitting a self-assessment return.

These additional criteria include:

  1. Receipt of any untaxed income: If individuals receive income that hasn’t been subject to tax withholding, they need to submit a self-assessment tax return.
  2. Partner in a business partnership: Individuals who are partners in a business partnership need to file a self-assessment return regardless of their income level.
  3. Liability to the High-Income Child Benefit Charge: If taxpayers have a liability for this, they are required to submit a self-assessment tax return.
  4. Self-employed individuals with gross income over £1,000: Self-employed individuals whose gross income from self-employment exceeds £1,000 must file a self-assessment return.

It’s important to note that this criteria is not exhaustive, and there may be other circumstances where individuals are required to submit a self-assessment tax return, even if their income through PAYE falls below £150,000.

How we can help

At Williamson & Croft, we understand that tax changes can be complex and overwhelming for individuals.

The recent announcement by HMRC regarding the above presents an opportunity for us to assist you in navigating these changes and ensuring compliance with the tax regulations.

Our team of tax experts stay up to date with the latest legislation and guidelines. We are well-equipped to help you understand the implications of the increased self-assessment threshold.

Whether you are affected by the current threshold or anticipate being impacted, we can provide tailored advice and support to ensure that you meet your tax obligations efficiently and effectively. Our services include:

Tax planning: We can analyse your financial situation and devise tax strategies to minimise your tax liability within the legal framework. By considering factors such as untaxed income, partnership involvement, High Income Child Benefit Charge, and self-employment income, we can help you optimise your tax position.

Self-assessment guidance: Our team can guide you through the self-assessment process, ensuring that you understand the requirements and deadlines. We will assist you in preparing and submitting accurate tax returns, considering any applicable exemptions, reliefs, and allowances.

Compliance support: We will help you remain compliant with tax laws by staying abreast of any changes or updates. We will ensure that you meet the necessary criteria for self-assessment and fulfil your obligations without any undue risks or penalties.

Personalised advice: Every individual’s financial circumstances are unique. Whether you have concerns about the impact of the threshold change, require assistance with tax planning, or seek guidance on any other tax-related matter, we are here to provide reliable and practical solutions.

By entrusting your tax affairs to us, you can have peace of mind knowing that your tax obligations will be handled professionally, accurately, and in a timely manner.

Contact us today to schedule a consultation with our experienced team. We are committed to providing you with expert guidance and support throughout the tax changes and beyond, helping you make informed decisions and achieve your financial objectives.