Employment taxes and self assessment

Self assessment threshold rises to £150,000

HMRC has confirmed that for the tax year to 5 April 2024 and onwards, the self assessment threshold for taxpayers taxed through PAYE only, will change from £100,000 to £150,000.

Affected taxpayers do not need to do anything now as the self assessment threshold for the tax year to 5 April 2023 remains at £100,000. 

Taxpayers will receive a self assessment exit letter if they submit a 5 April 2023 tax return reflecting income between £100,000 and £150,000 taxed through PAYE and they do not meet any of the other criteria for submitting a self assessment return.

For the tax year to 5 April 2024 and onwards taxpayers will still need to submit a tax return if their income taxed through PAYE is below £150,000 but they meet one of the other criteria for submitting a self assessment return, such as:

• receipt of any untaxed income;
• partner in a business partnership;
• liability to the High Income Child Benefit Charge
• self-employed individual and with gross income of over £1,000.

Tax code

Tax codes are issued by HMRC and are used by your employer when processing the payroll to calculate the amount of tax to deduct.

Employees should check their tax codes to ensure these are correct.

Tax code errors are most likely to occur when there is a change in circumstance and in the following cases:

• Changing or starting a new job
• Having more than one job

Receiving employment benefits

Other Reliefs

Work related expenses

Tax relief can be claimed for work related expenses including uniforms and work clothing, buying work-related equipment, professional fees, union memberships and subscriptions, and using their own vehicle for work travel, excluding journeys from home to work.

Gift aid

Tax relief can be claimed when you make a qualifying gift aid donation.

If you are a higher rate or additional rate taxpayer, additional tax relief is available and your basic rate band will be increased by the gross amount of the gift aid donation.

The charity can claim an additional 25% of the amount originally donated.

Pension contributions

You can get tax relief at source in all personal and stakeholder pensions, and some workplace pensions. Your pension provider claims 20% in tax relief from the government, which is added to your pension pot.

If you are a higher rate or additional rate taxpayer, you can claim further tax relief from HMRC. This is usually claimed through your self-assessment tax return.

Should you require any assistance with the completion of your self-assessment tax return, Perrys can of course assist and oversee this process for you, acting as your agent and liaising with the Revenue on your behalf.

Should you require any help or further information, please do not hesitate to contact your local Perrys branch.