When You No Longer Need to Complete Self Assessment

If your circumstances change and you no longer need to complete Self Assessment, you must tell HMRC to avoid penalties and unnecessary correspondence. This might happen when you stop self-employment, no longer have rental income, or your income returns to being taxed only through PAYE. Notifying HMRC properly ensures your tax affairs remain in order and you don't face fines for missing returns you no longer need to submit.

When you might no longer need to complete Self Assessment

You need to complete a Self Assessment tax return each year if certain conditions apply. You must send a return if, in the last tax year:

• You were self-employed as a sole trader and earned more than £1,000 (before deducting expenses)
• You were a partner in a business partnership
• You had to pay Capital Gains Tax when you sold or disposed of something that increased in value
• You had to pay the High Income Child Benefit Charge and don't pay it through PAYE
• You are an off-payroll worker repaying a student or postgraduate loan
• You have untaxed income such as rental income, tips and commission, income from savings and investments, or foreign income

If none of these conditions apply to you anymore, you may no longer need to complete Self Assessment. For example, if you've stopped being self-employed and now receive all your income through PAYE (Pay As You Earn), or you've sold your rental property and no longer receive rental income, you can ask HMRC to remove you from Self Assessment.

How to tell HMRC you don't need to send returns anymore

You must inform HMRC if you believe you no longer need to complete Self Assessment. HMRC won't automatically remove you from the system just because your circumstances have changed.

You should contact HMRC to let them know you no longer meet any of the conditions that require you to submit a tax return. Once HMRC reviews your situation, they will confirm whether you can stop filing returns.

If HMRC asks you to send a tax return, you must still send one, even if you think you no longer need to be in Self Assessment. You may have to pay interest and a penalty if you don't file and pay on time.

Completing your final tax return

Before HMRC removes you from Self Assessment, you need to make sure you've completed your final tax return correctly. This return should cover all income and gains up to the end of the last tax year in which you met the Self Assessment requirements.

You must keep records (such as bank statements or receipts) so you can fill in your tax return correctly. These records help ensure your final return accurately reflects your income and any allowable expenses or reliefs.

The normal filing deadlines still apply to your final return:

• Paper returns must be submitted by 31 October following the end of the tax year
• Online returns must be submitted by 31 January following the end of the tax year

For example, if you stopped being self-employed during the 2024/25 tax year (which runs from 6 April 2024 to 5 April 2025), you would still need to complete a tax return for that year, with a deadline of 31 January 2026 for online filing.

Paying any outstanding tax

HMRC will calculate what you owe based on what you report in your final return. You must pay your Self Assessment bill by 31 January following the end of the tax year.

How much tax you pay depends on the Income Tax band you're in. There's a different rate for Capital Gains Tax if you need to pay it, for example if you sell shares or a second home.

Even after HMRC removes you from Self Assessment, you remain responsible for paying any outstanding tax bills from previous years. Make sure all your tax affairs are up to date before you stop filing returns.

What happens after you leave Self Assessment

Once HMRC confirms you no longer need to complete Self Assessment, they will remove you from the system. You won't receive tax return reminders or face penalties for not filing returns for future tax years.

Your tax will then be collected through other means, such as:

• PAYE if you're employed
• Automatic deductions from your pension
• Tax deducted at source from savings interest or dividends (where applicable)

Keep in mind that if your circumstances change again in the future and you meet any of the conditions requiring Self Assessment, you must tell HMRC by 5 October following the end of the relevant tax year. You would then need to register for Self Assessment again (or reactivate your account if you've been registered before).

If you're not sure whether you need to send a return

If you're uncertain whether you still need to complete Self Assessment, you can check with HMRC. It's better to check and be certain than to either:

• Submit returns you don't need to (wasting time and effort)
• Fail to submit returns you should have filed (risking penalties)

Remember that you must send a return if HMRC asks you to, even if you don't think you meet the conditions. Contact HMRC if you believe there's been a mistake.

Sources

• Self Assessment tax returns

This article provides general guidance based on current HMRC rules. For advice specific to your situation, speak to your accountant.