Self-Assessment threshold to rise in 2023/2024
How will these changes affect you –
HMRC has announced that starting from the tax year 2023 to 2024 onwards the Self-Assessment threshold for taxpayers taxed through PAYE only will rise from £100,000 to £150,000.
These changes do not affect the current 2022/2023 tax year where the self-assessment threshold remains at £100,000.
Clients will receive a Self-Assessment exit letter if they submit a 2022 to 2023 return showing 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 2023 to 2024 tax year onward taxpayers will be required to submit a tax return if their income taxed through PAYE is below £150,000 but they meet one of the following criteria:
- receipt of any untaxed income,
- partner in a business partnership,
- liability to the High-Income Child Benefit Charge, or
- self-employed individual and with gross income of over £1,000.
It should also be noted that in 2023/2024, the starting point for the 45% tax rate will reduce from £150,000 to £125,140. The ongoing reduction in the tax-free dividend allowance and increasing returns on deposit accounts will see the majority of taxpayers paying more tax.
Taxpayers can check if they need to submit a 2022/23 tax return by using HMRC’s online checking tool
Other useful links
Self-Assessment general enquiries
Disclaimer: The information in this article is provided for general information only and does not constitute legal or professional advice. We cannot accept responsibility or liability for any actions you may take, or not take, based on this information.