How to declare the UK personal income tax?

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Today, we will share with you information about how to declare the UK personal income tax.

As an employer, you will follow a system called Pay As You Earn, or PAYE for short. This system is that when the employer pays the employee, the Income Tax will be deducted directly. As an employee, the tax has already been paid when the salary is received, so there is no need to pay additional tax, the employer has already paid it.

Employers will deduct National Insurance in addition to the Income Tax portion. So when you receive your salary for the first time, you might have questions, why is it different from the agreed salary? Because the employer has already deducted the two expenses just mentioned.

Let’s say for example, if the monthly salary is 3,000 pounds, when it goes to the bank account, there may be 2,300 to 2,400 pounds left, so it is very different from the Hong Kong system. Because in Hong Kong, only the MPF part is deducted from the salary received, but in the UK, the tax is deducted before it is handed over to you, so in the UK, it is rare to hear a working family applying for a tax loan, because it has been paid when the salary is received. However, tax loans are still in demand for business owners.

If the source of income is purely from wages and there is no other income and no overseas income, there is actually no tax to be reported.

But if there is overseas income, interest income, dividend income, money earned from buying and selling stocks, and money earned from buying and selling properties etc., all of these need to be declared and paid separately.

For example, if you have a job in the UK, you have Income Tax in the UK. This part has been paid by the employer. But at the same time, if there are still businesses running in Hong Kong that pay dividends. This part needs to be declared, and of course, tax will be paid after declaration.


What about the UK tax year?

It is close to Hong Kong, but different. The tax year is from April 1 to March 31 in Hong Kong and from April 6 to April 5 in the UK.

So the next question will be, how should I report the income in Hong Kong?

Then you need to register for Self Assessment, and you can find relevant URLs in Google searches.

When is the registration deadline for Self Assessment?

The registration deadline in 2022 is October 5. The registration is to receive a UTR from the tax bureau. The full name is Unique Taxpayer Reference. It will become your tax identification number. The IRS will send the number to the registered address by post. With this set of numbers, you can file a tax return.

When is the deadline for filing tax returns in the UK?

If you file tax returns in Paper Tax Form, the deadline is October 31, 2022, while the online tax filing deadline is January 31, 2023. The tax payment deadline is also January 31, 2023. When I am writing this blog, the date is August 14, 2022, so if you haven’t registered yet, please pay attention to the deadline, and you have about one and a half months to register.

I hope you find today’s content useful.

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