Anyone who files their Self Assessment tax return with FreeAgent needs to complete the Main Return page.
This article provides a summary Main Return page and the compulsory information required, as well as some additional information about the more commonly completed boxes.
For more information, speak to your accountant or HMRC, or see HMRC's guidance.
Remember: FreeAgent cannot advise you on how to fill in your tax return correctly, nor can we check your figures to see if they are correct, unless they have been calculated by the software. We are not authorised by HMRC to provide accounting or tax advice. If you are in any doubt as to whether a figure on your tax return is right, you need to speak to your accountant or to HMRC. If you don't have an accountant, have a look in our accountants' directory for a FreeAgent-friendly accountant.
HMRC asks you to provide some personal details at the start of the Main Return page. Complete the required fields and provide your phone number if you're happy for HMRC to contact you by phone.
Unique Taxpayer Reference (UTR)
HMRC issues a UTR to all self-employed taxpayers. You will find the number at the top of any letters you receive from HMRC. The UTR number is always 10 characters long and these 10 characters will all be numbers - no letters. Make sure you use your own UTR. If you are in a partnership, you, your partner(s), and the partnership itself will all have different UTRs. If both you and your spouse have UTRs, be careful not to get them confused.
Bank interest received - tax taken off
When you receive interest on a bank account, this may be free of tax, or be taxed at 20%. If it's taxed, the bank pays 20% to HMRC on your behalf and you receive the amount after tax. Interest that's already had tax taken off goes into box 1 of the Income section of the main return.
FreeAgent flags up, above box 1, the total of any transactions that you've explained as Other Money In > Interest Received, which HMRC say must be put here on the Main Return rather than on the Self Employment pages. You may need to put these in box 1 if taxed, or box 2 if not taxed.
If your business's year end does not match the tax year end (which is always 5th April), the bank interest from your accounts must be included in the Income section in accordance with what the bank paid to you in the tax year - not the accounting year. FreeAgent will handle this automatically, flagging up the total of what you posted as Interest Received in the tax year.
If you have bank accounts other than the business bank account, and you received interest on these accounts, fill this in too, adding the interest to either box 1 or box 2.
If the interest was taxed, use the figure for interest after tax has been taken off - that is, the amount that was actually paid into your bank account(s) between 6th April and 5th April.
Bank interest received - no tax taken off
Some bank accounts have interest paid into them gross - that is, no tax is taken off. This goes into box 2 of the Income section of the main return. You will have to pay tax on this income.
Interest paid tax-free, such as interest on an ISA, does not go on to the tax return at all.
In the Income section of your main return, record any dividends you've received during the tax year, after the tax credit is taken off - so you would record the amount you actually received.
Dividends are always paid out to shareholders net of a tax credit. When you receive a dividend voucher, you'll see three numbers on it: the dividend before tax credit is taken off, the tax credit, and the amount of the dividend after the tax is taken off. HMRC explains this in more detail.
Make sure you choose the correct box from numbers 4-7 depending on where you received the dividend from.
State Pension received
If you're receiving State Pension, then in box 8 of the Income section of the main return, you should record the gross amount from the pension statement that you get from the Department of Work and Pensions (DWP). This won't necessarily be the amount you've actually received into your bank account, because State Pension is paid in arrears.
Pension contributions paid
As a sole trader, you may well pay money into a personal pension.
If you pay these sums out from your business bank account, remember you should explain them as Money Paid to User > Drawings.
Because there are several different boxes into which your own personal pension might go (boxes 1-4 in the Tax Reliefs section of the main return), FreeAgent can't populate these for you.
Speak to your accountant or to HMRC if you're not sure which box to put your pension contributions into, or what figure to use.
The most commonly used box here will be box 1, where basic rate tax relief is claimed by the pension provider on your behalf. In this case you'll enter the amount you paid in, and FreeAgent will ‘gross this up' for tax relief. So if you paid in £800, the provider will have claimed £200 tax relief, so you would enter £800 in box 1 and FreeAgent will work out the tax relief for you. This will be on the pension certificate or receipt that the pension provider gives you each year.
Donations made to charities
If you've made donations to charity under Gift Aid, you should include only the amount you actually donated, not the relief the charity will claim.
If you've explained any transactions in your accounts as Payment > Charitable Donations, you will need to enter these figures into the main return yourself. FreeAgent will correctly show these donations as not allowable for tax in the Self Employment page (short version or long version), so that tax relief is not given twice.
If your income for the tax year that ended on 5 April 2016 was less than £10,600 and your spouse or civil partner’s income was less than £42,386, you can transfer £1,060 of your Personal Allowance to your spouse or civil partner to reduce the amount of tax they pay if all of the following apply:
- you were married to, or in a civil partnership with, the same person for all or part of the tax year
- you were both born on or after 6 April 1935
Alternatively, if the above apply and your income for the tax year that ended on 5 April 2016 was less than £42,386 and your spouse or civil partner's income was less than £10,600, you can receive the marriage allowance in the form of £1,060 of their Personal Allowance.
You can apply for the marriage allowance online and and you should make sure your application has been processed by HMRC before you submit your Self Assessment.
If you’ve registered to transfer or receive the allowance, or plan to do so, answer ‘Yes’ in the section shown below.
FreeAgent knows whether you’re either transferring the marriage allowance or receiving it based on your income. If you’re receiving the marriage allowance (and not transferring it), you don’t need to do anything further after selecting ‘Yes’ in the section shown above. If you’re transferring the marriage allowance, you will also be prompted to enter your partner’s details.