How to Set Up a Personal Tax Account?

Anyone starting their business journey, whether setting up as a sole trader, landlord, freelancer, contractor, small business or limited company, has a lot of tasks and administrative work to complete.

If you are becoming self-employed, you’ll need to set up a personal tax account with HMRC. A personal tax account allows you to communicate and update information to HMRC online about income tax, benefits and Self Assessment.

This blog will tell you all you need to know about creating a personal tax account.

What is a personal tax account?

A personal tax account is an account that individuals set up with HMRC in the UK. The account allows people to sign in to HMRC online services to manage their personal tax affairs, rather than calling or writing to HMRC.

What can I do with my personal tax account?

Once you have set up a personal tax account, it gives you access to a vast range of services, including:

• Checking your details including your Unique Taxpayer Reference (UTR) number and your National Insurance number.

• Notify HMRC of a change of name or address.

• Check your current tax code.

• Fill in, view and submit a personal Self Assessment tax return (there is a separate service to file your Self Assessment tax returns)

• Claim an income tax refund.

• Check for benefits and allowances such as Child Benefit, State Pension and Marriage Allowance.

• Manage tax credits.

• See income earnt and how much income tax you have paid in the previous 5 years.

• Look at your National Insurance contributions and determine how much national insurance you’ve paid and if paying voluntary NI contributions would benefit you.

• Check work benefits such as private medical insurance and company car benefits.

Youll need to sign in with your Government Gateway user ID to do all of the above.

What is a Government Gateway account and ID?

A Government Gateway account provides individuals and small businesses with access to online services. A Government Gateway ID is a 12-digit number that allows you to access your account.

To set up your personal tax account, you will need a Government Gateway user ID and account, so get this set up first.

How do I set up a Government Gateway account?

Creating a Government Gateway account is a simple process.

If you have never had a Government Gateway account you will need to set one up by visiting HMRC online here.

You must enter an email address to which HMRC will send you a confirmation code. You will then use this code to confirm your email details. A Government Gateway user ID will then be issued to you.

Keep your user ID, passwords, and other information safe so you don’t forget your login details in the future.

Don’t confuse this with your Unique Tax Reference (UTR) number, which is only 10 digits long and identifies your business to HMRC.

How do I set up a personal tax account with HMRC?

Below are the steps and details you’ll need to follow when setting up a personal tax account to access all the services above.

1. You will need a Government Gateway account to set up a personal tax account. You’ll need to sign in using your Government Gateway ID. If you don’t already have a user ID, set one up using the steps above.

2. Prove your identity. Make sure you have all the information and documents you need to set up your personal tax account. You’ll require proof of identity and personal details to verify who you are. This can be done using documents for example, a P60, a payslip from the last 6 months, a photo ID such as a UK driving license or UK passport.

3. Once you have your Gateway ID, you can sign in using this and you will be asked what type of tax account you want to set up. (see types of tax accounts below). Choose the type of tax account you want to set up.

4. Set up security and verify your details. You will need to set up additional security measures, including a mobile phone number to receive access codes by text message. To verify who you are, you’ll need information such as your National Insurance number, date of birth, and employment status.

You’re now ready to go!

Accessing your personal tax account

You can access your personal tax account via HMRC online services using your computer. Sign in here. Alternatively, you can now access your account using the HMRC app that helps you manage your tax account online via your mobile phone.

Types of tax accounts to access HMRC online services

HMRC have different types of online accounts. These are:

1. Individual accounts.

2. Organisation accounts.

3. Agents accounts.

To access HMRC online services as an individual, you must set up a Government Gateway account.

A Government Gateway Account allows you to set up and access the following types of accounts and services with HMRC:

• Individual accounts

• Register for Self Assessment tax returns.

Individual accounts

You can set up a personal tax account and register for Self Assessment tax returns within an individual account. Your Government Gateway account will allow you to do both of the above.

Organisation accounts

An organisation account with HMRC allows businesses like limited companies, partnerships and sole traders to access their business tax accounts. A business tax account will enable people to register for Self Assessment if self-employed, register for VAT, set up PAYE and access Corporation tax services if you are a limited company.

Agents accounts

Agents accounts allow your accountant or tax agent to access HMRC services on your behalf. Your tax agent will use this account to access your personal details and provide information to HMRC on your behalf.

For help and advice on setting up details with HMRC, Self Assessment tax returns and tax planning contact us today at 033 0088 3616, email or book a free consultation.

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