Do I, and how, have to complete a Self Assessment?

[alisonpeters]

I am employed, and have shares (part of my bonus) in the company I work for.

I have not before completed a self assessment, but I was told today by a friend that since I receive dividends on those shares in 2011-2012 I will have to complete a self assessment.

However, I have looked on HMRC website and according to their guidance on who needs to complete an SA http://www.hmrc.gov.uk/sa/need-tax-return.htm#1 it doesnt include shareholders.

My question is twofold, firstly do I need to complete an SA, and if so will I be penalised for not notifying HMRC as it is after the October deadline?

Many thanks.

 

[Mitchells Bristol]

Hello there

I would imagine HMRC's intention is for dividends to fall within the "£2,500 of investments" heading.

Essentially, if you are liable to tax on the dividends you receive (i.e. they put you into higher rate tax), then you are required to notify HMRC that you are chargeable to tax. If you are into higher rate tax and the dividends received are less than £2,500 typically you can convince HMRC to adjust your PAYE code to collect the tax due on the dividends. If more than £2,500 then they will probably request you to submit a self-assessment tax return.

Hope this helps

 

[David Griffiths]

You do not have to complete a self assessment simply because you have shares and dividends.

You only have to do an SA return if the total income from employment and dividends takes you into higher rates of tax. For this purpose, you "gross up the dividends by multiplying by 10/9 and at that to your other income - probably just your salary.

If the total for the year 2011-12 is more than £42,475 then you must notify HMRC so that they can send the form.

If it's less, you don't have to do anything

(As ever this assumes that you only have salary and dividends and not something else that might come into the equation )