Self Assessment for limited company directors

This article explains how Self Assessment for limited company directors works in FreeAgent.

FreeAgent uses the financial data you enter throughout the year to populate some of your Self Assessment tax return. All you have to do is check the figures and enter the remaining information. FreeAgent then calculates your tax bill and allows you to file your completed tax return directly to HMRC. Once you've filed your Self Assessment return and paid your tax bill to HMRC, find out how to explain a Self Assessment payment to HMRC.

Here’s how it works.

Self Assessment pages that are supported in FreeAgent

Limited company directors can complete the following pages of the Self Assessment tax return in FreeAgent. Please note that some pages aren't supported.

Main Return

The Main Return page is where you should record your personal details, sources of income such as bank interest, dividends from shares and any tax relief that you’re entitled to. It’s also the page where you should record any charges that apply to you, such as student loan repayments and the High Income Child Benefit Charge.

Employment

If you’re on the company’s payroll, you should use the Employment page to report your wages and any benefits you received from the employment during the tax year. If you have more than one paid job, you must fill in an employment section for each job.

Self-employment

You should use the Self-employment page to report your profits if you have a self-employed business in addition to the income you receive from the company of which you’re a director. If you don’t have an additional self-employed business, you won’t need to complete this page.

UK property (SA105)

You should use the UK property page to report property income if you’re a UK resident landlord. If you have income for property outside the UK you won’t be able to report it here - unless it’s for furnished holiday lettings (FHLs) in the European Economic Area (EEA).

Tax Adjustments

The Tax Adjustments page contains an overview of your tax liability and the National Insurance contributions that you owe. You should use this page to record the details of any tax adjustments that you want to make (e.g. applying for a reduction in your payments on account).

Self Assessment pages that are not supported in FreeAgent

The following pages of the Self Assessment tax return for limited company directors are currently not supported in FreeAgent:

• Foreign Income
• Capital Gains summary
• Trust Income
• Residence, remittance basis etc
• Anything on the 'SA101 Additional Information' form

If you need to complete any of these pages then you won't be able to use FreeAgent to submit your Self Assessment tax return.

Completing your Self Assessment tax return in FreeAgent

Before you get started

Make sure that you’ve explained all of your bank transactions for the tax year that you’re filing for. If you run payroll in FreeAgent, you should have either filed month 12 payroll for the tax year in question or marked month 12 as filed.

FreeAgent doesn't know exactly which pages and sections of the Self Assessment tax return apply to you and your business. It's therefore a good idea to double-check exactly which pages you need to complete before getting started.

Finding your Self Assessment tax return in FreeAgent

Navigate to the ‘Taxes’ tab at the top of the screen and select ‘Self Assessment’ from the drop-down menu.

Select the relevant name from the ‘User’ drop-down menu.

Select the relevant tax year from the list on the left-hand side of the panel or from the 'History' drop-down menu.

Completing the pages of your tax return

Use the tabs at the top of the return to access each page of your Self Assessment tax return.

You’ll notice that some of the boxes are populated by FreeAgent based on the data that you’ve already entered. You will need to fill in the other boxes manually. Those that are required by HMRC are indicated in FreeAgent with an orange outline. If a box isn't relevant to you and isn't required, you can leave it blank.

Choose ‘Yes’ at the start of every section that applies to you. Any sections that remain set to ‘No’ won’t be included in your tax return.

FreeAgent will automatically save the data as you enter it. If you need to complete some of the required information on a page, you’ll see an ‘In Progress’ notification indicating how many sections or questions still need to be completed.

Once you’ve entered the required information on all the relevant pages of your Self Assessment tax return, you can then file it directly to HMRC through FreeAgent. Please note that only users with the role of 'Director' and level 8 access can file their tax returns through FreeAgent.

How FreeAgent calculates your tax bill

FreeAgent uses the data in your Self Assessment tax return to calculate the amount of tax and class 4 National Insurance contributions that you owe HMRC. This figure is displayed in the panel to the right of your Self Assessment tax return in FreeAgent. Please note that any payments on account you need to make for the following tax year will not be included in this figure.

You can see a step-by-step breakdown of this calculation by selecting the ‘Your Tax Breakdown’ tab at the top of the return.

The information displayed in the Your Tax Breakdown area can serve as the equivalent of an SA302 form. You can print this information directly from FreeAgent.

There are a number of methods available for paying your tax bill to HMRC. Check out our guide to paying your tax bill to find out more.

Once you've paid your tax bill to HMRC, find out how to explain a Self Assessment payment to HMRC.