Self Assessment Tax Return — Complete Guide for 2026/27

Self Assessment is HMRC's system for collecting Income Tax from people whose tax isn't automatically deducted at source — including sole traders, freelancers, landlords, limited company directors and those with multiple income streams. If this applies to you, here is everything you need to know for the 2026/27 tax year.

Who needs to complete a Self Assessment tax return?

You must register for Self Assessment if any of the following apply:

• You are self-employed as a sole trader and earned more than £1,000
• You are a partner in a business partnership
• You receive rental income from property
• You are a company director (unless your only income is a salary taxed through PAYE)
• You have income from savings, investments or dividends above the relevant thresholds
• You have untaxed income from any source above £2,500
• Your income is over £100,000

Key deadlines for 2026/27

Missing a Self Assessment deadline results in an automatic £100 penalty, even if you have no tax to pay. Further penalties accrue the longer the return remains outstanding.

• 5 April 2025 — End of the 2026/27 tax year
• 5 October 2025 — Deadline to register for Self Assessment (if new)
• 31 October 2025 — Paper return deadline
• 31 January 2026 — Online return deadline AND payment of tax due AND first payment on account for 2026/27
• 31 July 2026 — Second payment on account for 2026/27

What can you claim as expenses on Self Assessment?

You can deduct allowable business expenses from your income before calculating your tax bill. These must be wholly and exclusively for business purposes. Common allowable expenses include:

• Office costs — stationery, printing, software subscriptions
• Travel costs — fuel, parking, train fares (not commuting)
• Clothing — uniforms or protective clothing only (not regular clothes)
• Staff costs — wages, salaries, subcontractor costs
• Professional fees — accountant fees, legal costs
• Marketing — advertising, website costs
• Use of home as office — £6/week flat rate or actual proportion
• Business phone and broadband
• Professional subscriptions and memberships
• Bank charges and interest on business loans
• Training directly related to your current business

How to reduce your Self Assessment tax bill

There are several legitimate strategies to reduce the amount of tax you pay:

• Claim all allowable expenses — many sole traders underclaim because they're unsure what qualifies
• Use your personal allowance — the first £12,570 of income is tax-free in 2026/27
• Pension contributions — contributions to a personal pension reduce your taxable income
• Trading allowance — the first £1,000 of self-employment income is tax-free
• Capital allowances — claim for equipment and assets used in your business
• Gift Aid donations — extend your basic rate band if you are a higher rate taxpayer

What is payment on account?

If your Self Assessment tax bill is over £1,000, HMRC will ask you to pay advance payments towards the following year's bill. These are called payments on account, and are paid in two instalments — 50% by 31 January and 50% by 31 July. First-time filers are often caught off guard by this, as they effectively pay one and a half years of tax in their first January. If your income will be lower in the coming year, you can apply to reduce your payments on account.

Can I use a business bank card for all expenses?

You can use a business bank card or credit card for business expenses. This makes record-keeping much simpler as all business transactions appear on one statement. However, the key rule is that the expense must be wholly and exclusively for business — using a business card for personal purchases doesn't make those purchases tax-deductible. Keep your business and personal finances completely separate.

How Fernside Accounting can help

Fernside Accounting prepares and files Self Assessment tax returns for sole traders, landlords and company directors across Woodford Green, Chigwell, Loughton, South Woodford, Snaresbrook, Gants Hill, Chingford, Epping, City of London, Wanstead. We review your expenses, identify all available reliefs and ensure your return is filed accurately and on time. Book a free 20-min call today.