Four steps to completing your tax return

It's that time of year again - your tax return is due. Make sure you get it in on time as HM Revenue & Customs (HMRC) has brought in tougher penalties for latecomers.

1. Create an account

The paper deadline has already passed so you'll have to fill out your tax return online. Register at you'll need your unique taxpayer reference (UTR), a 10-digit tax reference number - you will find it on any of your paperwork from HMRC - plus your national insurance number or postcode.

Once you've registered, your user ID will be displayed - make a note of this as it's the only time you'll see it. An activation code will then be posted to you; this can take up to a week so register by mid-January.

2. Be prepared

Gather together pension contributions, charity gifts, savings and information on any other sources of income such as a buy-to-let property. If you're filling out a tax return for supplementary work on top of a regular job, ask your employer for your P60 to find out how much tax you've paid through your salary.

3. Know the deadline

The deadline for online self-assessment is midnight on 31 January 2012. But if you owe less than £3,000 and you want any of this taken through your tax code, the deadline was 30 December 2011.


4. Beware the penalties

File your return one day late and you'll instantly owe £100 - even if you don't owe any tax. After three months, you'll be fined £10 for each subsequent day, capped at £900. After six months, you'll pay an extra 5% of tax owed or £300 (whichever is the greater). This process is repeated again if you are 12 months late.

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Don't use paper, use the internet!

You need to register on the HMRC Gateway, for which you need to obtain your UTR (Unique Taxpayer Reference), and then wait for HMRC to post you an Access Code.

The main benefits are:
1. Your input errors are highlighted immediately.
2. Your tax liability is automatically calculated.
3. You can amend your input before submission.
4. You receive a confirmation of receipt on submission.
5. You have until January to submit it.