This podcast isn’t personal advice. If you’re not sure what’s right for you, seek advice. Tax rules can change and benefits depend on personal circumstances.
Use the player icons above to listen on your favourite podcast app, or read the full transcript below.
This podcast isn’t personal advice. If you’re unsure what’s right for you, seek financial advice. Tax and pension rules can change, and benefits depend on personal circumstances. Investments can fall as well as rise in value, so you could get back less than you invest.
Full podcast episode transcript
[0:10] Sarah Coles: Hello and welcome to the Switch Your Money On podcast from Hargreaves Lansdown. I’m Sarah Coles – I’m Head of Personal Finance.
[0:16] Helen Morrissey: And I’m Helen Morrissey – Head of Retirement Analysis.
[0:19] Sarah Coles: So, depending on how speedily you’ve picked this episode up, you’ll either be in the dying days before a tax return is due, or you’ll have scraped in just under the wire – or, indeed, actually, you might have missed the deadline altogether.
But we didn’t want to just add to the nagging in the last few days before the deadline – we actually wanted to provide something a bit useful. So, whatever of these positions you’re in, we can actually offer some useful lessons so that you could actually learn from your tax return.
[0:43] Helen Morrissey: Absolutely.
So, to start from the very beginning, your tax return for the 2024-2025 tax year is due to be paid by midnight on 31st January 2026.
Now, 5.65 million people hadn’t filed their Self-Assessment tax return by the start of the year – only 6.36 million had done it, so there’s quite a lot of people that left it pretty late.
[1:10] Sarah Coles: Yes – I have actually, in the past, been that person who’s been rushing for the deadline – so, if you’re in that boat, you have all my sympathy. But we should really start with a few quick tips for those people who are yet to get it over the line.
So, there are some jobs that you really need to do right now – so, even if you put off everything else, there are just things to crack on with straightaway. So, check you’ve got access to the system first – and that’s really important. So, you’re gonna need your Unique Taxpayer Reference number – and you’re also gonna need to make sure that you can access the Government Gateway.
So, if you haven’t registered for Self-Assessment, then you won’t have your Unique Taxpayer Reference Number... so do it now because that can take days to reach you because it comes by post. Also, if you’ve not registered for the Gateway yet, that can also take up to 10 days for your activation code to get to you. So, it’s definitely worth... literally, right now, go away and do it – and then come back and listen to us, obviously.
If you’ve forgotten or lost either of those two things, then don’t panic – can actually recover them.
[2:02] Helen Morrissey: I mean, it’s great advice, actually, Sarah – because, through experience, I know that the whole thing of getting set up on the system is something that... people really underestimate how long it can take – and it has tripped people up in the past.
[2:15] Sarah Coles: Yes – and, I mean, one of the other things that tends to trip people up is when they think, ‘Right – okay, finally, I’m gonna get going,’ and then they realise they don’t have some key paperwork that they need. So, also, before you get down to it, start with your paperwork.
So, it includes things like details of interest on any savings accounts – and things like dividends on shares outside the ISA. You’re also gonna need your pension statement, and proof of any employment income, and any benefits you get from work.
Now, obviously, if you work for yourself, you’ve got a whole other bunch of different things to do – so you’ll want things like bank statements, sales invoices, receipts for expenses – and, of course, if you still have them, paying-in books.
So, I think, one of the things to bear in mind is, if you’re going through this process and you think, ‘Oh, my goodness, I don’t have this statement’ – or, ‘I don’t have a piece of information that I need – and I need to order it’ – then you can think, ‘Well, I’ve missed the deadline because there’s no time for it to arrive.’
That, actually, is a really common mistake. So, you don’t actually have to wait for that to arrive – you can submit an estimated return and then update it when the paperwork arrives. All you need to do is make sure you complete the section on the form that shows that estimates have been used.
[3:15] Helen Morrissey: And then, once people have got everything together, are there any tips? What kind of things are people tending to overlook?
[3:22] Sarah Coles: So, there’s one that’s relatively... I say, ‘Relatively new’ – I’m obviously so old that everything feels relatively new! – ...
[3:26] Helen Morrissey: [Laughs]
[3:26] Sarah Coles: ...but there is what’s known as the High Income Child Benefit Charge – it trips off the tongue! – and that kicks in if anyone in the family earns £60,000 or more.
So, if your income (or your partner’s) is pushed over this threshold – and you get Child Benefit – then you’re gonna need to repay at least some of it. So, if you tick the box on the Self-Assessment form, it’s gonna calculate what you owe.
Of course, if you or your partner make £80,000 or more, you actually need to pay it all back. So, another job that’s worth doing is getting in touch with HMRC, and actually just say you don’t want to have the payment. You still claim the benefit – so you’ve still got any accompanying National Insurance credits that come with it, but you don’t then have to go through the rigmarole of having the money and then paying it all back again.
[4:06] Helen Morrissey: That’s a really useful top-tip there, Sarah. Is there anything else that people need to be aware of?
[4:11] Sarah Coles: Yes. So, this is one thing that is new – so technically new – because, actually, crypto’s relatively new.
So, HMRC’s actually been reminding people that gains from crypto need to be declared for Capital Gains Tax purposes. So, if it took your total capital gain over your annual allowance, you actually need to pay tax – and, if you made a loss, you also need to complete a tax return if you want to offset it against gains in future years. And it’s worth really knowing, actually – with crypto... it’s not just when you sell it that matters. If you spend it – or if you trade it for another crypto... they both count as triggering a tax assessment. So, actually, you could have tax to pay at those points too.
But, of course, one of the huge areas where there is loads and loads of potential for making mistake is pensions – so I should ask you about this, Helen.
[4:51] Helen Morrissey: Yeah, absolutely, Sarah.
So, it’s just worth saying, first of all, that you can receive tax relief on your pension contributions right up until the age of 75. However, if you are a higher or additional rate taxpayer, it’s important to realise that you may not have received the full amount of tax relief that you are due – and that you may need to actually reclaim it, which you can do via Self-Assessment.
So, it all depends on what type of pension that you’re in. If your pension is set up under what is known as a net pay arrangement, then the correct tax relief should be taken. This is because your pension contribution is deducted from your salary before income tax is paid – and your scheme will claim back the tax relief at your marginal rate of income tax.
It’s also important to say that, if you are in a salary sacrifice arrangement, you’ll also receive the right amount of tax relief, automatically, there. However, if your pension is set up under what’s known as ‘Relief at source,’ then you will need to claim the higher rate tax relief if you’re a higher or additional rate taxpayer. You can do this online through Self-Assessment or by writing to HMRC.
[6:01] Sarah Coles: And, of course, always what happens when we talk about pensions is we get into the jargon almost straightaway. So, I should ask you... what actually is a relief at source pension?
[6:09] Helen Morrissey: A great question.
So, many private pensions – such as SIPPS (Self-Invested Personal Pensions), as well as some workplace pensions – are set up as relief at source – and this means that contributions are deducted from your salary after tax. So, it means the employer will take 80% of the contribution from the employee’s salary and then reclaim the extra 20% from HMRC.
So, this means that, if you are entitled to tax relief at a higher rate... so whether it’s higher rate – additional rate, if you’re in Scotland – they have several different tiers of tax – then you will need to reclaim it.
[6:47] Sarah Coles: So, assuming you do need to reclaim this, how d’you go about it?
[6:50] Helen Morrissey: So, if we just think about the Self-Assessment tax return for a moment... there will be a section in there which is called ‘Tax relief’ – and this is where you will input the appropriate data.
So, when it asks for figures, be sure not to include employer contributions in your figures – or any contributions taken from your pay before it was taxed. You might also need to input the amount that you paid into the scheme plus the basic rate of tax relief already received.
So, with this in mind, just make sure that you’ve kept hold of statements from your pension provider, as that will really help you to fill in the return – and you can also use them as evidence if you’re asked.
Now, if you’ve not reclaimed tax relief in previous years, the good news is that you can go back four years when it comes to reclaiming unpaid tax relief. So, as I say, you can do it online or by letter. You can receive the unclaimed tax relief either by an adjusted tax code, or there could be a refund into your bank account.
[7:49] Sarah Coles: I think there’s loads of useful stuff there. I think one of the things people don’t realise is, when they’re sorting out how much to put on the form, they might just think about just putting their contributions in there, and not realising the tax relief – so that’s a really important extra thing...
[8:01] Helen Morrissey: Yep – ...
[8:01] Sarah Coles: ...to be aware of.
[8:02] Helen Morrissey: ...and what I would add there as well is that HMRC have some really great explainers, taking you through that section of your Self-Assessment form – so it’s well worth taking the time to have a look at those, and it’s really useful.
[8:15] Sarah Coles: I mean, one of the other things that HMRC has been highlighting this year, in particular, is that, in most cases, the tax is automatically calculated for you when you’re doing your tax return – but you need to be aware of the glitch in the system for this year.
So, if you remember – to think back – many, many moons ago! – but the Capital Gains Tax rate actually changed in the Autumn Budget for stocks and shares. So, if you sold assets like shares after 30th October 2024, then the system actually won’t automatically calculate the correct amount of Capital Gains Tax you have to pay.
So, annoyingly, it means you need to use the adjustment calculator – which is also on the GOV.UK website – and that will help you make changes to the calculation.
[8:52] Helen Morrissey: Good to know.
[8:53] Sarah Coles: So, what else can you do on Self-Assessment for pensions?
[8:55] Helen Morrissey: So, you can also use your Self-Assessment form to detail and pay any annual allowance tax charges that you might have incurred. So, the annual allowance is the maximum that you can pay into your pension per year and receive tax relief. It’s set at the lowest of £60,000 per year or your annual salary.
Now, if you are a very high earner – or have flexibly accessed a pension – you might actually find that your annual allowance is lower, so it is important to check... there’s always caveats with pension things.
I also want to emphasis that it is really important to be scam-aware – especially as the deadline approaches and panic does start to set in. Be wary of any phishing or scam attempts at targeting tax-return filers – including fake refund messages. You know, top-tip is... always access HMRC online services directly by going to GOV.UK in your browser, not by clicking links in emails or texts.
[9:54] Sarah Coles: D’you know, I get so many scam-approaches at this time of year, and it’s a really good reminder. But, of course, when you’re completing your tax return, it does feel like it’s a headache... you know, how ever calm you are – and how ever you’ve taken the sensible approach of doing bit by bit – and not panicking too much – it does feel like it’s a massive hassle. But it is worth knowing that, actually, not doing it is even more of a hassle – because, if you miss the deadline, then you’re gonna have to pay some penalties.
So, if you miss it – even by a minute – there’s a fine of £100 to pay – and then, after three months, if you still haven’t submitted your tax return – or paid the bill – then the penalties get even tougher. So, they go to £10 a day – which is up to a maximum of £900. Then, there’s another penalty after six months, and then 12 months – both of which are 5% of the tax due or £300 – whichever is greater.
So, it means that, while hitting the deadline, it feels like it’s taken a huge toll on your time and your patience – then missing it is actually even more costly, so it’s a really good reason to knuckle down.
[10:49] Helen Morrissey: Absolutely – and, if you have already submitted it, you might think your work is done, but there is a huge amount of value you can get from looking over what you’ve just sent.
What kind of things should people be checking for, Sarah?
[11:01] Helen Morrissey: Well, this year, in particular, one of the really big thing is to check whether you have to use ‘Making Tax Digital for Income Tax’ from this April – so April 6th this year. So, sole traders and landlords with a turnover of more than £50,000 are gonna need to use it – so you need to sign up as soon as possible.
So, getting started now... it’s gonna give you time to get to grips with the software that you have to use – and understand the new service – and, if the change starts to make the process too time-consuming, then it also gives you a chance to find an accountant who can do it for you.
Of course, the other thing that you can take away from this is... if you spent a long time digging out this paperwork – so things like interest payments, dividends, or profit on share sales – then you can consider consolidating to simplify things.
[11:42] Helen Morrissey: So, you can see your tax return like a checklist too, then.
So, your tax return will reveal what you’ve contributed to your pension during the year and will be a useful reminder of how much tax it could save you. However, you shouldn’t stop there – it is a chance to regroup, you know, from a pension perspective. You might be thinking, ‘Well, how much income are you set to get in retirement?’ – and it can be a really good way of working out whether you can check to see if you can afford to increase your monthly payments – and, hopefully, get a better pension as a result.
[12:12] Sarah Coles: Yes – and it’s not the only thing to check for.
So, one of the other things on there is it will show you how much dividend tax you’re paying – and, of course, you can then think about whether or not you can cut it.
So, some people who work for themselves start their own company and pay themselves – at least, partially – in dividends.
Now, thanks to the cuts in the dividend allowance, this now attracts tax once you make more than £500 a year – so it means that those who pay themselves in dividends will bust their dividend allowance almost immediately. So, if they also hold stock market investments outside an ISA, they’re likely to pay tax on any dividends they get this way.
So, the tax return’s gonna show you just how much financial pain this is causing, but it’s also an opportunity to consider moving existing investments into a Stocks and Shares ISA, using that share exchange process – or Bed and ISA – which will protect them from dividend tax forever.
[12:58] Helen Morrissey: Of course, it’s worth reflecting on how much work it was to do your tax return in the first place. So, the legwork will be fresh in your mind – you know, if you had to hunt around for dividend payments and tax slips to get all your paperwork done.
Bear in mind that, by investing through an ISA, you don’t ever need to put details about them on your tax return ever again. So, making the switch now could mean that you’ve got one less thing to worry about this time next year.
[13:23] Sarah Coles: And we always like having fewer things to worry about!
So, of course, all this extra attention to your tax return – when you’re going back, and checking over, and seeing where you are... that might actually expose a mistake – or you might be wondering if it means you made a mistake last year. But the good news is, there is time to correct it.
So, if you discover an error, HMRC allows amendments within 12 months of the original filing deadline. So, online submissions can usually be amended directly in your HMRC account. If more than 12 months have passed, you have to write to HMRC, explaining the reasons for the change, along with the change that you want to make. If the changes mean you need to pay more tax, then you’re gonna need to pay it, plus any interest – so that’s why it’s really worth acting as fast as possible.
Of course, if you’re due a refund, then the quicker you apply for it, the quicker you get it – so that’s another bonus of getting started immediately.
So, there’s been loads there – and, hopefully, there’s something for everyone to take away – and be better off, as a result of. But we won’t end on a note of, ‘Off you go, and get cracking’ – we’ll just go into the stat of the week, if that’s alright with you, Helen?!
[14:19] Helen Morrissey: Absolutely!
[14:20] Sarah Coles: So, as somebody who’s got quite close to missing the deadline, but never actually completely missed it, I had a question about, ‘How many people missed the tax return deadline in 2025?’
So, do you think it was 600,000 people – 1.1 million – or 2.2 million?
[14:37] Helen Morrissey: Wow – well, I’d really like to hope that it wasn’t as many as 2.2 million – I’d really like to hope that.
D’you know what, I’m ever the optimist – I’m gonna go for ‘600,000.’
[14:46] Sarah Coles: Ah – oh, God, you’re a bit too optimistic there – ...
[14:48] Helen Morrissey: Oh!
[14:49] Sarah Coles: ...it was actually ‘1.1 million’ – so over a million people are missing that deadline. So, if you’re feeling really bad for missing it – or you’re worried that you might – then you can take a bit of comfort from the fact that you’re actually not alone.
[15:00] Helen Morrissey: And that’s a lot of £100-fines – isn’t it – at the end of the day!
[15:03] Sarah Coles: It is! – it is – it’s a bit of a money-spinner for HMRC, ...
[15:05] Helen Morrissey: [Laughs] Yeah!
[15:05] Sarah Coles: ...I reckon.
So, that’s all for this week – but, before we go, we should remind you that this was recorded on January 19th 2026, and all information was correct at the time of recording.
[15:13] Helen Morrissey: Nothing in this podcast is personally advice – you should seek advice if you’re not sure what’s right for you.
[15:18] Sarah Coles: Tax rules can change and benefits depend on circumstances. Pension money can’t normally be accessed until the age of 55, which is rising to 57 from 2028.
[15:27] Helen Morrissey: All investments fall as well as rise in value, so you could get back less than you invest.
[15:31] Sarah Coles: So, all that’s left is for us to thank our Producer, Elizabeth Hotson.
[15:34] Helen Morrissey: And to thank you all very much for listening – we’ll be back again soon. Goodbye!
[15:38] Sarah Coles: Goodbye!