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More self-assessment tax returns filed than ever

Self-employed driving self-assessment growth

HMRC has revealed that a record-breaking 11.1million taxpayers filed their self-assessment tax return by the 31st January deadline, a figure which the association for the self-employed, IPSE, say is thanks to the UK’s “ever-growing” self-employed sector. 

According to the tax office, the number of individuals who filed their tax returns online also increased. The taxman said this “soared” to more than 10.4million, while HMRC’s Angela MacDonald thanked the millions who submitted their personal tax return on time for their contribution towards “vital public services.”

It is IPSE’s opinion that the record number of personal tax returns filed this year should come as no real surprise, given there are now over 5million self-employed workers in the UK – with highly-skilled female freelancers accounting for the biggest growth area. 

“Side-hustles” contribute to self-assessment rise

IPSE’s Policy Development Manager, Alasdair Hutchins, acknowledged the growing number of part-time self-employed people, who he said have contributed to the rise in self-assessments: “The record number of tax self-assessments is not just because there are more people who define themselves as mostly self-employed: it’s also because more people than ever are now doing side-hustles alongside other work.”

In addition, IPSE paid tribute to the relatively new emergence of online jobs platforms and technologies that connect freelancers with work. Hutchins said these “make it easier than ever before for people to top up their income by running their own business on the side. Many people even use this as a way to test the water before they take the leap into full self-employment.”

Government must “protect” self-employed

While self-assessments have increased, the IR35 lobbying-body urged the Government to nurture the UK’s growing self-employed population. This would serve to the benefit of HMRC, explained Hutchins: “Self-employment is one of the fastest-growing and most productive sectors of the workforce. The Government should protect and support this sector – both for freelancers themselves and for the tax benefit for the wider economy. It should start this by halting the extremely damaging changes to IR35 self-employed tax that are due in April. These changes may stall and even reverse the growth of the self-employed sector and, in the long-term, actually reduce the Government tax take.”

1m yet to submit their tax returns

HMRC’s Angela MacDonald urged the reported 1m people who haven’t submitted their self-assessment tax return to get in touch with the tax office. She said: “Customers who have missed the deadline should contact HMRC. The department will treat those with genuine excuses leniently, as it focuses penalties on those who persistently fail to complete their tax returns and deliberate tax evaders. The excuse must be genuine and HMRC may ask for evidence.”

 

By Contractor Doctor

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