EIM71410 - Assessments, appeals and other procedures: self assessments

Most employees will not need to complete a tax return which includes self assessment.

Requirement to complete a tax return.

HMRC can require any taxpayer to complete a tax return which includes a self assessment - See SAM10050. In 2024-25 this includes, for example, employees who receive total income of more than £150,000, if an employee wishes to deduct employment related expenses of £2,500 or more, if the High Income Child Benefit Charge is due, if they were self employed or a partner in a business partnership, if they had to pay Capital Gains Tax when they sold or disposed of something that increased in value or they have any untaxed income.

Bringing taxpayers into self assessment to deal with a contentious issue

Taxpayers who do not normally complete a tax return will be brought into self assessment for any tax year where there is a contentious point, for example a deduction for expenses, HMRC may then enquire into the return. Once the enquiry is completed and a closure notice is issued an appeal may be made against HMRC’s decision. If agreement is not reached, this provides the taxpayer with a route to appeal HMRC’s decision to the First-tier Tribunal.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

Time limit

Section 711(2) ITEPA 2003 provides that a taxpayer subjected to PAYE who has not been given a notice to complete a tax return by HMRC can require HMRC to give them such a notice no later than 3 years after the 31st of October next following the end of the year where PAYE was operated. The cut-off date is set so that a return which includes a self assessment can be made within the 4 year time limit for making a self assessment set out in section 34A (1) TMA 1970.