Sole trader Self Assessment error message: a problem with the data in your return

This article explains the steps to take to if you receive an error message that there is a problem with the data in your Self Assessment return if you’re a sole trader.

When populating your Self Assessment tax return, FreeAgent adds up all the transactions for a particular basis period (normally an accounting year) that have been allocated to each business cost category. These are then grouped by tax reporting type to match the cost boxes in the ‘Self Employment’ pages of your tax return. For information on how to view the categories which make up each tax reporting type, please see this article.

If the total value for a particular box in your Self Assessment tax return that represents a type of business cost has a credit balance (below zero), you’ll receive the following error message when trying to file the tax return:

If you have full (level 8) access to your FreeAgent account, you can follow the steps below to correct the error.

Navigate to the ‘Accounting’ tab at the top of the screen and select ‘Reports’ from the drop-down menu.

Select ‘Show Transactions’ in the ‘Detailed’ section.

Select the relevant accounting year and expense account from the drop-down menus. You can filter by tax reporting type to match the expense account displayed in the error message.

Please note that HMRC won’t accept a credit balance (figure below zero) for a cost box on your tax return.

To correct the credit balance of a cost on your tax return, review and re-allocate some (or all) of the relevant entries in that expense account by selecting any entries that are incorrect and making the relevant changes.

Alternatively, you could create a journal entry to adjust the total credit category balance and allocate it to another suitable category with a debit balance.

Once the total figure for each tax reporting type has an overall debit balance (comes to zero or higher), you will be able to file your Self Assessment tax return to HMRC from FreeAgent.

If you’re unsure where to re-allocate the incorrect expense entries to, please speak to your accountant as the credit (negative) balance will need to be removed to clear the error message.