Why Do You Need CA5601 Form: Why It Is Important

There are different ways to pay class 2 national insurance. Some people choose to self assess, while others opt for another method.

When you pay through self assessment, you’ll be sent an invoice showing what you owe and the amount you’ve already paid. You can pay online, over the phone or via post.

If you’re not getting an invoice, call HMRC on 0330 200 3519. They’re happy to help.

Your payment needs to reach HMRC by the deadline.

If you miss the deadline, you could face penalties.

If you’re paying from overseas, you need to know your sort code, account number, and account name.

What Not to Say to HMRC If Your Self Assessment Tax Return is Late

If you receive a letter from HM Revenue & Customs (HMRC), it usually means one thing – that your self assessment tax return is late. But what do you say if you find yourself in this situation? Here we look at some common mistakes people make when dealing with HMRC.

1. Don’t lie about how much money you owe.

You don’t want to admit that you’ve been negligent with your finances and that you’re unable to meet your financial obligations. This could lead to further penalties being imposed.

2. Don’t blame others for your problems.

The best way to deal with someone else’s mistake is to take responsibility for yours. Blaming others won’t change anything.

3. Don’t try to avoid paying your taxes.

There are many ways to dodge paying income tax. For example, you might claim expenses such as mortgage interest or rent on your tax returns. However, there’s no escaping the fact that you’ll still have to pay the tax bill.

What Expenses can you Claim when Self-Employed?

There are different ways to calculate class 2 National Insurance Contributions (NI). You can claim either:

• Class 2 – Income tax credit

• Class 2 – Additional income tax credits

• Class 2 – Employers’ NICs

If you are self employed, you should register for self assessment. If you are an employer you should register for employers’ NICs.

Make sure you allow enough time for your payment to arrive, as it depends on whether you use one of the following methods to pay:

• Direct debit

• Standing order

• Postal order

• Cheque

• Electronic bank transfer

• Paypal

• Credit card

• Other

You must ensure that you submit your application form and payment within the deadline. If you do not meet this deadline, you could face penalties.

If you fail to meet the deadlines, you might find yourself paying additional amounts to cover any gaps in the information.

Common Self Assessment Mistakes and How to Avoid Them

The most common self assessment mistakes are:

1. Not having enough information to make a decision

2. Making assumptions without checking facts

3. Failing to consider all factors

4. Being too optimistic

5. Overlooking risk

6. Not taking action

Frequently Asked Questions

What Expenses can you Claim when Self-Employed?

The taxman wants to know how much money you earn and what expenses you incur running your business. But it doesn’t want to know everything. You don’t have to tell it about your office supplies, your phone bill, your gym membership, your car insurance, your mortgage, your medical bills, your child care costs, your housekeeping or gardening expenses, your home improvements, your holiday travel or entertainment, your legal fees, your charitable donations, your pension contributions, your investments, your personal training sessions, your pet grooming, your dry cleaning, your laundry, your childcare, your household repairs, your gardening, your utility bills, your mobile phone contract, your internet connection, your petrol, your parking charges, your school fees, your subscriptions, your meals out, your holidays, your dental visits, your haircuts, your holidays abroad, your gifts, your charity shopping, your gym membership, or even your toiletries. And there are plenty of things you can claim against your income without telling HMRC.

But you do have to declare some expenses. For example, you must report your salary and earnings; you can’t just say “I’m self-employed”. If you’re paid less than £7,500 a year, you’ll need to pay National Insurance Contributions on your earnings too.

You also have to keep records of your business transactions, like invoices, receipts, bank statements, contracts, cheques, letters, and emails. These are called ‘business documents’. They include anything relating to the day-to-day operations of your business.

And finally, you have to complete a Self Assessment form every year. This asks questions about your business activities and income, including whether you’ve been involved in criminal activity or fraud, and how much profit you make.

What Not to Say to HMRC If Your Self Assessment Tax Return is Late

HMRC has published its list of the most common reasons why people don’t file their tax return on time. The top three are: “I didn’t know what I had to do,” “I forgot about it,” and “My accountant told me there wasn’t anything I needed to pay.”

The list includes some less obvious excuses too, such as “I’m waiting for my refund”, “I’ve been ill”, “I’ve just moved house” and “There’s nothing wrong with my computer”.