Can I Do My Own Tax Return or Should I Use an Accountant

Every year, millions of people in the UK must file a Self Assessment tax return. Some choose to complete it themselves using HMRC’s online system, while others prefer to use an accountant. Both options have advantages, depending on your financial situation and confidence with tax rules. If your income is straightforward, you might handle it on your own, but if you have multiple income sources, investments, or business expenses, professional help can save time and reduce stress. This article explores whether you should do your own tax return or use an accountant and what factors to consider before making a decision.

Who Needs to Complete a Tax Return

You must complete a Self Assessment tax return if any of the following apply:

  • You are self-employed or a partner in a business.

  • You earn income from property, dividends, or overseas sources.

  • Your annual income exceeds £100,000.

  • You receive child benefit and your income is over £50,000.

  • You have untaxed income that cannot be collected through PAYE.

The deadline for online submissions is 31 January following the end of the tax year, and penalties apply for late filing or inaccurate information.

Doing Your Own Tax Return

For individuals with simple tax affairs, such as those earning a single salary, freelance income, or small amounts of rental income, completing your own tax return is often manageable.

You can use HMRC’s Self Assessment online service to file directly. The system guides you through each section, asking for information such as:

  • Employment income and tax deducted under PAYE.

  • Self-employed earnings and expenses.

  • Bank interest, dividends, or other investment income.

  • Property rental income and related costs.

Once submitted, the system automatically calculates your tax liability and shows how much you owe or will be refunded.

Advantages of Doing It Yourself

Completing your own tax return can be a good choice if your finances are straightforward and you are comfortable managing numbers.

The benefits include:

  • No additional cost: You do not need to pay an accountant’s fee.

  • Better understanding of your finances: Filing your own return helps you see how your income and expenses affect your tax bill.

  • Simple online tools: HMRC’s online system and free guides make the process easier for basic cases.

For many employed individuals with one or two extra income sources, filing independently is quick and cost-effective.

Disadvantages of Doing It Yourself

While doing your own tax return can save money, there are risks if you are unfamiliar with tax rules or make mistakes.

Common disadvantages include:

  • Lack of expertise: UK tax laws are complex, and errors can lead to penalties.

  • Missed allowances and reliefs: You might overlook legitimate deductions that could reduce your tax bill.

  • Time-consuming: Gathering documents and completing the forms can take hours, especially if you are unsure what to include.

  • No professional backup: If HMRC questions your return, you must handle the inquiry alone.

If your income includes self-employment, property, investments, or foreign earnings, the complexity often outweighs the cost saving.

When You Should Use an Accountant

Hiring an accountant is usually beneficial when your tax situation is more complex or when your time is better spent elsewhere. You should consider professional help if you:

  • Run a business, partnership, or limited company.

  • Have multiple income streams or investments.

  • Receive income from abroad.

  • Own one or more rental properties.

  • Need to claim business or professional expenses.

  • Have sold property, shares, or other assets that may attract Capital Gains Tax.

  • Are a higher-rate taxpayer with pension or dividend income.

An accountant ensures that your return is accurate, compliant, and tax-efficient. They can also provide long-term advice on planning for future tax years.

How an Accountant Helps with Your Tax Return

A qualified accountant does much more than fill out forms. They can:

  • Review your income and expenses to ensure full accuracy.

  • Identify tax reliefs and allowances you might miss, such as mileage claims, pension contributions, or capital allowances.

  • Calculate payments on account for the following year to help you manage cash flow.

  • Deal with HMRC directly on your behalf if there are queries or audits.

  • Offer advice on business structure, VAT, and record keeping if you are self-employed.

For landlords, company directors, or professionals such as solicitors and consultants, accountants often save more money in tax than their fees cost.

Cost of Using an Accountant

The cost of hiring an accountant varies depending on your circumstances and location. As a general guide:

  • For a simple tax return, expect to pay £150 to £300.

  • For self-employed or property income returns, fees range from £300 to £600.

  • For company directors or those with complex income, it may cost £600 or more.

Most accountants offer fixed fees or online services for straightforward returns, and many will also handle correspondence with HMRC.

Avoiding Mistakes and Penalties

Errors on a tax return can result in HMRC penalties or investigations. Accountants reduce this risk by ensuring that:

  • All income is declared correctly.

  • Deductions and reliefs are applied properly.

  • Returns are filed before the deadline.

  • Record-keeping meets HMRC’s requirements.

Even small mistakes, such as entering figures in the wrong box or misreporting business expenses, can lead to problems. Having an accountant ensures professional oversight and peace of mind.

Time vs Cost Considerations

When deciding whether to file your own tax return or hire an accountant, consider the value of your time. If it takes you several hours to complete your return and you are unsure about accuracy, paying for professional help may be worthwhile.

An accountant can often save you more than their fee by identifying tax-saving opportunities, ensuring compliance, and freeing up your time for work or personal commitments.

Digital Record Keeping and Making Tax Digital

HMRC’s Making Tax Digital (MTD) initiative requires businesses and landlords to keep digital records and submit tax information quarterly using approved software.

If you are affected by MTD, an accountant can:

  • Set up compliant digital accounting systems such as Xero or QuickBooks.

  • Ensure data is recorded correctly for VAT and Income Tax.

  • Manage quarterly submissions and deadlines.

Using an accountant familiar with MTD ensures that you stay ahead of regulatory changes and avoid penalties.

The Best Approach for You

The decision between doing your own tax return and hiring an accountant depends on your comfort level, income complexity, and time availability.

You can likely handle your own return if:

  • You have one source of income and a few basic deductions.

  • You are confident using HMRC’s online tools.

You should use an accountant if:

  • Your financial affairs are complex or involve multiple income sources.

  • You want professional assurance and proactive tax advice.

  • You prefer to save time and avoid administrative stress.

Summary

Doing your own tax return is perfectly feasible if your finances are simple and you are confident navigating HMRC’s system. However, if your income includes self-employment, property, or investments, hiring an accountant provides peace of mind, accuracy, and often significant tax savings.

An accountant ensures compliance, minimises errors, and helps you make informed financial decisions for future years. Whether you choose to handle it yourself or seek professional help, the key is to file accurately, on time, and with a full understanding of your tax responsibilities.