Change in your employment status
As a self-employed worker you would have been required to submit a self-assessment tax return each year, so if you have decided not to carry on being self-employed, it may be the case that you no longer need to file a return, unless you have other taxable income which is not covered under PAYE.
For example, if you subsequently take paid employment, and that was your only source of income, you would be taxed at source via the PAYE system, so you would not need to send in a tax return.
If you have decided to stop being self-employed for whatever reason, you must let HMRC know about the change in your circumstances as soon as possible. If you delay, you run the risk of incurring penalties for missing the deadline for filing your tax return.
The simplest way to let them know of your change in status is via your Personal Tax Account with HMRC, which enables you to manage all your personal details and check your records.
If you haven’t yet set up your personal tax account, then you can use this link to create one https://www.gov.uk/personal-tax-account. You can also telephone them on 0300 200 3310.
A Tax return may still be required.
Depending on where you are in the tax year, HMRC may not have sent you a notice to file a return for that year. If that’s the case, letting them know why you believe you don’t need to submit a Self Assessment return could stop them from sending that notice.
If HMRC has already sent you a tax return to be completed, you can explain about your new circumstances and request that the form be withdrawn, and to confirm that no penalties will be incurred. It should be noted that you have a time limit of two years from the end of the tax year in question to ask for a tax return to be withdrawn.
If they decide you still need to complete the Self Assessment tax return, you will need to fill in the ‘Additional Information’ section to give details about your change in circumstances, and you must submit the tax return by the deadline to avoid financial penalties for a late submission.
If HMRC thinks you have not paid the correct amount of tax, they might decide to cancel the Self Assessment tax return and ask you to complete a Simple Assessment tax return instead.
Claiming a refund
Under normal circumstances, if you are due for a tax refund, this would be calculated automatically on receipt of your Self Assessment tax return. Once you have de-registered for Self Assessment, you can still claim any refund you think is due but the claim must be submitted within four years of the end of the tax year in question.