Am I a complete idiot for doing this tax return

[Taxdummy]

I have a sideline which in the last tax year brought in exactly £1005 before expenses.
In previous years it has been more so I’ve filled in tax returns with help from husband.

This year he had previously said not to bother doing one for the sake of £5 over the limit and a couple of hundred pounds in expenses.

But I am a rule follower so checked on the online thing and as it was over £1000 I clicked to start the online return form.
Didn’t get very far as needed husband’s help for something and now he says I’m an idiot for starting it (but will help me complete it-it’s just a waste of time and money that I’ll now be liable to pay)

my question is-now I’ve started the online form will it somehow alert hmrc that I need to complete it or could I still get away with not doing it?

If HMRC have issued you a tax return then you need to submit it to avoid a penalty. If you don't need one in future, let HMRC know so they cancel it.

Yes this.

Also I meant to say that you can check if they have issued you a tax return on your HMRC online account.

Yes if they have issued one you must submit it. But to be honest you are allowed £1000 without having to pay taxes ...did you only make £1005 in which case you will have just pennies due.

Yes, you have to fill it in otherwise you will get a penalty

Unless you are a Tory MP then you need to complete it.

If you’d completed a self-assessment tax return last year, you’d need to do one this year anyway, regardless of how much you did or didn’t make. If you were self-employed, even at a loss, you have to do a tax return. So your husband is wrong and you’re not an idiot.

What do you need his help with? It’s pretty straightforward really, once you’ve done it a couple of times.

You won’t owe anything - or less than a fiver, anyway.

You are bot tied into unnecessary tax returns for ever!

Yes if you need to do one. But if your circumstances change you can let HMRC know and they will take you "off the list".

And just because the OP has £1005 income doesn't mean she is potentially fleecing the country of ££££ in tax...she said it was £1005 before expenses

OP, I'm like yoy, I'd do the return just because I've started it. Then work out if you need to do it next year.

not tied in

Yes exactly £1005. I also have a salaried job too which I pay ‘normal’ tax on.

husband seems to think that once you go over the £1000 you have to pay tax on all of it, not just the £5?

I’ve been scrabbling together as many expenses receipts etc as I can but won’t bother if it’s only on the extra £5!

i actually don’t think I did one last year as didn’t earn any extra due to covid.

I think you’re getting confused.

You pay tax on any earnings over your tax-free personal allowance (£12,750 per year).

It doesn’t matter if that’s through an employer on PAYE or self-employment.

The self-assessment form will ask for ALL
earnings (PAYE and self-employment).

Then you’ll pay tax on what you’re over the £12,750 per year ‘free’ threshold.

Did you earn more than £12,750 last tax year from both jobs?

I agree with this it’s not optional

If HMRC are expecting you to do a tax return you must do it, even if you owe nothing. There's an automatic fine of 100 for failure to submit it, even if you owe no tax.

There is a trading allowance. You can either deduct your actual expenses from your self employment income or a £1,000 trading allowance. You are only paying taxes on the £5 profit. Seems mad for your amount but technically you need to do a return if you have extra tax to pay. It should be simple though, what do you need your husband’s help with?

If you earn less than £1,000 in 22/23 just ring up HMRC and tell them and they will cancel the notice to file.

Don't listen to your husband, if you have been issued a notice to submit then you need to do so, it's not even worth the phone call to hmrc to explain or try to cancel, it will take 10 minutes, deduct the £1000 allowance and pay the tiny amount due.

I don’t think you can just deduct the £1000 and pay the tax on the £5.
The best thing you can do is ring hmrc and explain it to them and they will help.
I have run a simple business from a book keeping point of view for years and I’ve never bothered with an accountant I’ve just phoned up when I have got stuck with my tax return. The year with the covid help I made a dreadful mess of it all, the hmrc advisor said every other person was doing the same and sorted it for me.

If you have a salaried job as well then you definitely have to do a tax return as you have two incomes. The tax liability is on total earnings. If you don't owe any tax you won't have to pay it.

@Orangesare - you can just deduct £1,000 trading allowance from gross turnover if your actual expenses are less than £1,000.

www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income#trade

If you intend to continue your sideline in the future, you need to do the tax return regardless of whether you make any money or not. You will need to declare your salaried earnings too. You will be charged tax on your profit once expenses etc are offset. If you do your admin work at home you can claim a percentage of home running costs to offset against your profits (in addition to receipted expenses). This will reduce the amount of tax you have to pay.

Tax return aside; is your husband always horrible to you?

I certainly am confused-it’s really not my forte!
Yes I earned more than £12750 last year.
Im sure I could do it by myself but he’s always just filled it in as I provide the documents.

Definitely do it. If you ‘miss’ a year also it will look odd potentially. I have had several years of not making enough profit to pay tax, but I always submit one. DH thinks I’m mad, but it really doesn’t take long and saves all kinds of potential pain. I once went through an account when I was earning more, and they taught me also to include everything. I used to make literally a few pence from a savings account, but was told to include this as if it was missing, there is the tiny possibility that it would trigger questions from them. Tax is logic and facts, just fill out the form.

Assuming you just have your employment income and self employment, you just need to select those sections on the HMRC system. Then type in your salary, tax deducted and student loan contributions (if relevant) from your P60 in the employment section (can also find the figures on your last payslip of the tax year). In the self employment section type the amount you made from your self employment (£1,005) and then either claim your actual expenses or the trading allowance (£1,000).

Assuming that you don’t pay into a pension from your net salary and you don’t earn more than £200,000 from your job you shouldn’t need to make any pension adjustments. This should be the return done.

As @Flapjackquack says, your self-assessment shouldn’t be complicated at all. I don’t think you need your husband to help! Just follow the steps as Flapjack outlines and job done.

Years ago I got told off by HMRC because I hadn’t send a tax return when I hadn’t been trading that year at all.
But I had the previous year, was still registered as self employed, therefore they expected a tax return….