What income needs to be declared on a self-assessment tax return?

Understanding what “income” means for Self Assessment

Completing a Self Assessment tax return can feel deceptively simple until you reach the sections asking about “income.” People often assume this means only their salary or what landed in their bank account. In reality, Self Assessment is designed to capture many different types of taxable income and gains, some of which are easy to overlook because they are irregular, come from overseas, are paid in benefits rather than cash, or are routed through platforms that don’t look like traditional employers.

At its core, the question is: what have you received during the tax year that the tax system treats as taxable, or that it needs to know about to calculate the right tax? The answer depends on your personal circumstances, your residence status, your sources of earnings, and whether any income has already been taxed at source. Even when tax has already been deducted, you may still need to include it on your return so the overall calculation is correct.

This article walks through the main categories of income that commonly need to be declared on a Self Assessment tax return, the kinds of payments that can be missed, and practical ways to think about your income streams so you can report them accurately. It also highlights areas where rules vary depending on thresholds and other factors, so you know when a payment is likely to matter and when it may not.

Employment income: wages, salaries, and benefits from a job

If you are employed, your employer usually deducts tax through PAYE. That can create the impression that your employment income is already “done” and doesn’t belong on Self Assessment. Sometimes that’s true: many employees never need to file a tax return. But if you do file a Self Assessment return, you may still need to enter your employment details, and you should understand what is included in “employment income.”

Employment income typically includes your salary or wages, overtime, bonuses, commissions, and any other payments for your work. It can also include payments in kind, where you receive a benefit rather than extra cash. Common examples are company cars, private fuel, private medical insurance, living accommodation, interest-free or low-interest loans from an employer, and certain other perks. These are often reported on forms such as a P11D or through payroll, but they can still be relevant when completing your return.

Expenses reimbursed by your employer can also matter. If you are repaid for genuine business expenses under an approved system, these may not be taxable. But if you receive round-sum allowances (for example, a flat “car allowance” or “homeworking allowance”), these may be taxable unless they fall within specific exemptions. Similarly, if you receive termination payments or redundancy packages, parts may be taxable depending on how they are structured and what portion is treated as compensation versus contractual pay.

Another area to watch is where you have multiple employments, have changed jobs during the year, or have taxable benefits that were not fully captured through PAYE. If you are required to file Self Assessment, it’s important to ensure all employments are included and that the figures match your end-of-year documents (such as P60s and any relevant benefit statements).

Self-employment and trading income

If you are self-employed as a sole trader, you generally need to declare your trading income and your allowable business expenses. “Trading income” includes the money you receive for selling goods or services, and it can arise through invoices, cash payments, card payments, online platforms, subscriptions, retainers, tips, and anything else that is paid because of your business activities.

It’s also important to consider timing. Your taxable profit is not always just “what came into my bank account.” Depending on the accounting method you use, you may be counting income when you invoice it, when you receive it, or using a simplified approach. You should also consider whether you have received grants or support payments linked to your business, and whether these are treated as taxable income of the business.

Self-employment income can extend beyond the obvious. If you freelance occasionally, do side gigs, run a small online shop, create digital products, offer coaching, provide consulting, or earn money through short-term contracts, those receipts can all be part of trading income. People sometimes miss income from online marketplaces and platforms because it arrives as a “payout” after fees, refunds, and adjustments. In those cases, it’s wise to keep records showing gross sales, platform fees, refunds, and net receipts so you can calculate profit correctly.

Trading income can also include non-cash receipts. For instance, if you are paid partly in goods, services, or vouchers, there may be a taxable value. Likewise, if you barter services, the value of what you receive can be treated as income in some situations.

Partnership income

If you are a partner in a business partnership, you usually need to declare your share of the partnership profits. Partnerships generally file a partnership return, and each partner then reports their own share on their individual Self Assessment return. Even if you do not handle the partnership’s bookkeeping yourself, you still need to understand what share of profit you have been allocated and whether there were any special allocations, changes in partnership shares, or additional income sources within the partnership.

Partnership income may include trading profits, interest received by the partnership, rental profits if the partnership owns property, and other receipts. You typically declare your share rather than the partnership’s total. If you joined or left a partnership during the tax year, the apportionment of profits can be complex, and it becomes especially important to retain documents showing how the profit share was calculated.

Company director income and dividends

Being a company director can introduce multiple income streams that need to be declared. Directors often receive salary through PAYE and dividends as shareholders. Both can need reporting on Self Assessment, particularly if you have dividend income beyond certain allowances or you are otherwise required to file a return.

Director loans and expense claims can also become relevant. If you borrow from your company and do not repay within certain timelines, there can be tax consequences for the company and potentially for you, depending on the facts. Similarly, if you receive benefits from the company such as a company car, private medical insurance, or reimbursed personal expenses, those may be taxable benefits. Some directors also have pension contributions made by the company, and while these may be tax-efficient, they can still interact with your overall tax position.

Dividends are a particularly common area of confusion. People sometimes think dividends are “already taxed” because the company has paid corporation tax. In reality, dividends are taxed in the hands of the shareholder. If you receive dividends from UK companies or overseas companies, they can need reporting depending on your circumstances and thresholds.

Rental income from property

Income from renting out property is a major category that commonly must be declared. This includes rent from residential property, rent from commercial property, rent from land, and sometimes income from letting a room in your own home. Property income can also include payments for services provided to tenants, such as cleaning, utilities, or maintenance if these are bundled into the rent or billed separately.

It is easy to miss certain types of property-related receipts. For example, if a tenant pays you to release them from a lease early, if you receive insurance payouts that relate to lost rent, or if you charge a premium for granting a lease, these may be treated as property income or otherwise be relevant for tax. Likewise, if you rent out parking spaces, storage space, or provide short-term accommodation, those receipts can still fall under the umbrella of taxable income, though the precise treatment can depend on the nature of the letting activity.

When declaring rental income, you generally report the profit after allowable expenses. But “profit” is not always intuitive, and there are specific rules about what expenses can be deducted and whether certain finance costs get relief in a particular way. Recordkeeping matters: keep evidence of rents received, agent statements, invoices for repairs, insurance, service charges, and other costs associated with the property business.

Income from letting a room in your own home

Letting a room in your home can have special rules. Some people assume that because it is “just a lodger” it does not need to be declared. In reality, it can still be taxable income, although there may be reliefs or thresholds that mean you owe no tax or that you can choose a simplified method.

If you receive money from a lodger, including payments for bills, cleaning, or meals, this may count as receipts. Depending on the totals and the reliefs you use, you may or may not need to declare it, but if you are already completing a tax return for other reasons it is important to consider whether this income should be included.

Interest and savings income

Many people earn interest from bank accounts, building society accounts, credit unions, or other savings products. Tax may not be deducted at source in many cases, but that doesn’t automatically mean it is tax-free. Whether you need to declare interest depends on your overall tax position, any allowances you are entitled to, and whether you are required to file a return for other reasons.

Savings income can include interest from fixed-term bonds, notice accounts, some peer-to-peer lending arrangements, certain government or corporate bonds, and sometimes interest from loans you have made personally. If you have joint accounts, the interest is generally split according to ownership, which is often 50/50 for spouses or partners unless there is a formal arrangement stating otherwise.

Another common oversight is foreign interest. If you have overseas bank accounts or savings products, the interest may still be taxable in the UK depending on your residence status and the basis on which you are taxed. Even when the sums are not large, you should keep records, including the amounts received and the exchange rates used to translate them into sterling.

Dividends and other investment income

Dividend income can arise from shares held directly, from certain collective investments, or from overseas investments. Dividends are not the same as interest, and they are taxed under different rules. If you receive dividends from your own company, from a portfolio of shares, or through certain investment platforms, they may need to be declared on your Self Assessment return.

Investment income can also include distributions from funds. Depending on the type of fund, you may receive interest distributions or dividend distributions, and the tax treatment can differ. Platform statements can help, but they can also be confusing because payments may be described as “income,” “distribution,” “dividend,” or “interest” without clearly stating the tax category. It’s worth reviewing the tax vouchers or consolidated tax certificates if your platform provides them.

Overseas dividends can be subject to withholding tax in the country of origin. That does not necessarily settle your UK position. You may need to declare the gross dividend and then claim relief for the foreign tax suffered, depending on the rules and any relevant treaties.

Capital gains: when “income” isn’t income

Self Assessment isn’t only about income; it can also be used to report capital gains. A capital gain arises when you dispose of an asset and make a profit compared to what you paid for it (adjusted for certain costs). Disposals include selling assets, gifting them in some situations, exchanging them, or transferring them in ways that count as disposals for tax purposes.

Common sources of capital gains include selling shares outside tax-sheltered accounts, selling a second property, selling cryptocurrency, or disposing of valuable items. Even though capital gains are not “income” in the ordinary sense, they can still need to be declared on a tax return if you have gains above the annual exempt amount or if you meet certain reporting conditions.

People often miss gains because they think only property sales matter. In reality, selling a portfolio of shares, cashing in certain investments, or transferring assets can all generate gains. Keeping a simple ledger of purchases, sales, fees, and dates makes it much easier to determine whether you need to report anything.

Taxable state benefits and social security payments

Some state benefits are taxable and some are not. If you receive taxable benefits, they may need to be included on a Self Assessment return, especially if you are already filing. Examples can include certain forms of jobseeker-related payments, some incapacity-related benefits, and other taxable support. Because benefit names and structures can change over time and vary by circumstance, the safest approach is to check whether the specific benefit you receive is treated as taxable and whether you have received official documentation showing amounts paid during the tax year.

Even if a benefit is taxable, tax is not always deducted when it is paid. That can lead to an unexpected tax bill if the benefit is not factored into your overall calculation. If you receive benefits while also working or running a business, it is particularly important to ensure your return includes everything relevant.

Pensions: state pension, private pensions, and pension lump sums

Pension income is another major category. This can include the State Pension, workplace pensions, personal pensions, annuities, and pension income drawn through flexible arrangements. Some pension payments are paid with tax deducted, while others may not be, depending on the type of pension and your tax code.

If you take lump sums from a pension, the tax treatment can be mixed: some parts may be tax-free and other parts taxable. The paperwork provided by the pension provider often explains what was paid and what tax was deducted, but it can still be confusing because emergency tax codes are sometimes applied initially. If you are required to submit Self Assessment, reporting the pension income correctly helps reconcile what you owe or what you might be due back.

Pension income can also include overseas pensions. These can involve additional complexity around double taxation agreements and how the pension is classified. If you have foreign pension income, it is wise to keep detailed records and ensure you understand whether it is taxable in the UK and whether you can claim relief for any tax paid overseas.

Income from freelance platforms, the gig economy, and online marketplaces

Modern income streams don’t always come with tidy paperwork. If you earn money through gig-economy apps, freelancing platforms, delivery services, ride-hailing, marketplace selling, content creation, or subscription-based services, the money you receive is still potentially taxable. These payments can be trading income, employment income, or miscellaneous income depending on the facts, but in many cases they will need to be declared if they are taxable and you are within Self Assessment.

Creators and influencers often receive income in varied forms: ad revenue, sponsorship fees, affiliate commissions, tips, platform bonuses, and gifts. They may also receive free products. Some of these benefits can have a taxable value, particularly where they are given in exchange for promotional work rather than as a genuine gift with no strings attached.

For marketplace sellers, receipts can include sales proceeds, postage charged to buyers, and sometimes platform-funded promotions or credits. The platform might subtract selling fees, payment processing fees, refunds, and chargebacks before paying you. The net payout is not always the same as your taxable turnover. To report accurately, you typically need the gross receipts and the expenses separately.

Commission, referral fees, and affiliate income

Commission income and referral fees can be easy to miss because they often arrive as small payments from multiple sources. Affiliate marketing income, referral credits that are paid out in cash, and commissions from recommending services can be taxable. In some cases, referral rewards are provided as vouchers or credits rather than cash; whether these are taxable can depend on why you received them and whether they are linked to business activity.

As a practical step, review any dashboards you use for affiliate programs and download annual statements where available. If the programs pay in foreign currency, keep records of the amounts and how you converted them into sterling for reporting purposes.

Foreign income and overseas assets

Foreign income can include overseas employment income, income from overseas self-employment, rental income from property abroad, foreign dividends, foreign interest, and distributions from overseas funds. The UK tax treatment depends on your residence status and, for some individuals, the basis of taxation they use. Even when foreign tax is deducted at source, you may still need to declare the income and then claim relief to avoid being taxed twice, where applicable.

Foreign income is often underreported not because people want to hide it, but because they are unsure how it fits into a UK tax return. The most important practical point is recordkeeping: keep statements, tax certificates, and any evidence of foreign tax withheld. Also keep notes on exchange rates used and the dates the income arose.

If you have overseas bank accounts or assets, it can be worth checking whether any additional reporting obligations apply. Even when the amounts are small, having a clean record can prevent issues later, particularly if a return is reviewed and you need to demonstrate how you arrived at your figures.

Trust income and income from estates

If you receive income from a trust or from an estate, this can also need to be declared. Trust distributions can come with tax credits or have specific tax characteristics depending on the type of trust. Beneficiaries may receive statements from trustees showing the nature of the income and any tax already paid.

Similarly, if you receive money from an estate during the administration period, there may be taxable income involved, such as interest or dividends earned by the estate. The estate’s administrators typically provide documentation showing what has been distributed and the tax treatment.

This is an area where it is especially important to rely on official statements, because the labels “distribution” or “payment” do not automatically reveal whether the amount is taxable income, a capital distribution, or something else.

Income from casual work, short-term contracts, and “one-off” projects

Casual work and one-off income can still be taxable. People sometimes assume that if a job was small, paid in cash, or done as a favour, it doesn’t need to be reported. But if you are paid for work, that is generally income. The key questions are whether it is taxable and whether you are required to submit a return. If you are completing Self Assessment anyway, it is prudent to include all relevant taxable income streams so your return is complete.

Examples include being paid to help at events, tutoring, doing design work, photography, DIY jobs, performing or DJing, coaching, or seasonal work. If you are not employed by the payer and no PAYE has been operated, the income may be treated as self-employment or miscellaneous income depending on the pattern and intention behind the activity.

Keep simple records: dates, amounts, what the work was, and any expenses you incurred. Good records reduce stress at year end and help you understand whether a side activity is growing into a business that needs more formal tracking.

Royalties, licensing, and intellectual property income

Royalties are payments for the use of intellectual property such as books, music, photography, patents, software, or other creative work. Licensing income can arise when you allow others to use your content or technology in exchange for fees. These payments may be taxable and may need to be declared, even if they are paid by an overseas platform or a publisher that deducts tax at source.

Royalties can arrive in irregular patterns: quarterly statements from a publisher, monthly payouts from a music distributor, or periodic payments from a licensing agency. Because they can be paid after deductions, it is helpful to keep the gross amounts and the deductions separate where possible, particularly if the deductions include foreign withholding tax.

Student loan deductions, tax already paid, and why declaring still matters

When thinking about “what income needs to be declared,” it helps to separate two concepts: whether income is taxable, and whether it has already had tax deducted. Some income is taxable but paid gross, so you may need to pay tax through your return. Some income is taxable and taxed at source, but it may still need to be included so the return reflects your full income and ensures the right overall tax rate is applied.

In addition, your return might affect student loan repayments, high-income benefit charges, or other calculations that depend on income levels. This is one reason why omitting income can cause problems even if you believe the tax difference is small: the return is used to calculate more than just income tax.

If you are unsure whether a particular payment has already been taxed, check any payslips, P60s, pension statements, and investment tax vouchers. For platform income, review payout summaries and any year-end statements the platform provides. The goal is to avoid double-counting while still capturing the full picture.

Refunds, reimbursements, and settlements

Not every payment you receive is taxable income. Refunds of amounts you previously paid (for example, a refund from a supplier or a returned purchase) are not usually income. Reimbursements of expenses can be non-taxable if they genuinely repay costs you incurred on behalf of someone else. But the details matter.

In a business context, if you recharge a client for expenses and that recharge is part of your business receipts, it can count as income, with the corresponding expense also being deductible. If you receive a settlement payment, the tax treatment can depend on what the settlement is compensating you for. Payments for lost profits can be treated differently from payments for personal injury, and employment-related settlements can have their own rules.

These situations are often fact-specific. If a payment is significant or unusual, it’s worth categorising it carefully and keeping all documentation showing what it was for.

Insurance payouts and compensation

Insurance payouts are another area that can surprise people. Some insurance receipts are not taxable, but others can replace taxable income. For example, if you have business interruption insurance and it pays out to replace lost trading receipts, that payout may be treated similarly to the income it replaces. If you receive compensation that substitutes for rental income, that too may be treated as taxable in a similar way.

On the other hand, payouts that compensate for damage to property or that are clearly capital in nature may not be treated as income in the same way, though they can still have implications for capital gains calculations if they relate to the value of an asset. The key point is to avoid assuming that “insurance equals tax-free.” Check what the payout relates to.

Cryptoassets and digital assets

Cryptoassets can produce taxable amounts in more than one way. People often focus only on selling crypto for a profit, but there can also be taxable income-like receipts. Depending on what you do, you might receive staking rewards, mining income, airdrops, or other returns that can be treated as income or as part of a capital gains computation.

If you trade frequently, the line between investment and trading can also become relevant. Recordkeeping is crucial: transaction histories, fees, wallet movements, and conversions between tokens can all affect the calculation. Even if you use multiple exchanges, you should aim to keep a consolidated record for the tax year.

Because this area is technical and can involve many transactions, it’s often helpful to maintain a running spreadsheet or use software that can import transaction data and summarise it. The important thing is not to ignore it just because it feels complicated; incomplete reporting can create bigger problems later.

Other income: what falls into “miscellaneous” categories

Tax returns often include a place for “other income.” This is where income goes when it doesn’t fit neatly into employment, self-employment, property, savings, dividends, or pensions. Common examples can include income from occasional services that do not amount to a trade, certain types of grant income not linked to a business, payments received for acting as an executor or in other roles, or income from use of personal assets in some contexts.

If you receive money and you cannot immediately place it in a category, don’t assume it is irrelevant. Instead, ask: why was I paid? Was it in exchange for work, for the use of an asset, as a return on an investment, or as a gift? The reason for the payment often reveals the correct tax category.

Gifts, inheritances, and genuinely non-taxable receipts

A common anxiety is whether gifts from family and friends must be declared. In many everyday situations, a genuine gift with no expectation of something in return is not taxable as income and does not belong on a Self Assessment return as income. Similarly, inheritances are generally not treated as income to the recipient in the usual sense, although inheritance tax issues are handled separately from income tax, and income generated by inherited assets after you inherit them can of course be taxable.

However, not everything that is called a “gift” is a gift for tax purposes. If you receive something because you provided services, because you are an employee, or because you are promoting a product, that is more likely to be treated as taxable. The safest approach is to look at the substance of the arrangement rather than the label used.

Commonly missed items that people should double-check

Before you submit a return, it helps to run through a checklist of items that are frequently forgotten:

Employment-related extras such as bonuses paid after leaving a job, taxable benefits, and certain termination payments.

Income from side work, gig platforms, tutoring, or any casual paid tasks.

Online selling receipts, especially where the platform reports only net payouts.

Bank interest from multiple accounts, including joint accounts and accounts you rarely use.

Dividends from small shareholdings and reinvested dividends that still count as income.

Foreign interest or dividends, and overseas rental income.

Crypto staking rewards, airdrops, or gains from disposals.

Trust distributions or income from estates.

Rental-related receipts beyond “monthly rent,” such as compensation for lost rent or lease premiums.

Even if you ultimately find that some items are covered by allowances or do not create extra tax, the act of checking helps you avoid accidental omissions.

How to organise your income information before you file

Self Assessment becomes far easier when you treat it as a recordkeeping project throughout the year rather than a frantic exercise at the deadline. A practical approach is to create a simple folder system (digital or paper) with sections for employment documents, self-employment invoices and expenses, rental statements, savings and investment statements, pension documents, and anything foreign-related.

For self-employment and property income, keep a running spreadsheet or accounting software that tracks money in and money out, categorised sensibly. For investments, download annual tax certificates from your platform if available. For foreign income, keep statements and note exchange rates used. For crypto, export transaction histories regularly so you are not dependent on an exchange retaining accessible data forever.

When it comes time to file, you should be able to answer these questions confidently: What did I receive? When did I receive it? Why did I receive it? Was any tax deducted? What evidence do I have? If you can answer those, you are usually well-positioned to complete the relevant sections accurately.

When income needs to be declared even if you think no tax is due

Sometimes people hesitate to declare income because they believe it falls under an allowance or because the amounts are small. But if you are required to file a return, the return is expected to include relevant taxable income streams, not only the ones that generate additional tax. Declaring income correctly can also support claims for reliefs and ensure you are not accidentally pushed into the wrong tax bracket because income was omitted or misclassified.

In addition, some calculations depend on total income, such as the reduction of certain allowances as income rises, or the calculation of charges and repayments. Leaving out an income source can lead to an incorrect result even if the tax on that specific income would have been small.

Final thoughts: aim for completeness and clarity

The safest mindset for Self Assessment is to treat “income to declare” broadly: employment pay and perks, profits from self-employment, partnership shares, rental profits, savings interest, dividends, pensions, taxable benefits, foreign income, and relevant gains. Many of the most common mistakes come from assuming that only traditional salary counts, assuming that “already taxed” means “doesn’t belong on the return,” or overlooking modern income sources from platforms and digital assets.

If you build a habit of collecting documents and maintaining a simple record of incoming payments, Self Assessment becomes less about detective work and more about accurately transferring information into the correct boxes. The key is not perfection on the first attempt, but a careful, methodical review of all the ways money and value came to you during the tax year, including the ones that don’t look like income at first glance.

By thinking in categories and checking the commonly missed areas, you can dramatically reduce the risk of omissions and make the process feel manageable. And if you encounter a payment that is unusual, large, or hard to classify, treat that as a prompt to investigate further rather than a reason to ignore it. A complete, well-organised return is usually the quickest path to confidence that you have declared what you need to declare.