UTR Number: Unique Taxpayer Reference Number
A UTR number is a Unique Taxpayer Reference number. It is a 10-digit code that uniquely identifies a person or business in the UK for tax purposes. UTR numbers are issued by HM Revenue and Customs (HMRC) and are used for a variety of tax-related activities, such as filing a Self Assessment tax return, claiming a tax refund, or registering for the Construction Industry Scheme (CIS).
Its purpose is to personally identify you or your company to HMRC for any matters pertaining to your tax responsibilities. Like your National Insurance Number, your UTR number will not change during your entire life.
Online applications and self-employment registration are two of the quickest ways to obtain a Unique Taxpayer Reference number. On the HMRC website, this is possible. Although, your limited company or self-assessment registration will trigger the automatic issuance of a UTR number.
In this article, we will be discussing more in-depth the UTR number and what is the need of it. So, without any additional delay, let’s begun with it.
What is UTR Number?
The term “UTR number” means to a specific transaction reference number. Each and every money transfer to India is given a unique code. It is used to keep track of the transaction’s progress and settle any potential conflicts.
In the UK, a taxpayer who qualifies to file self-assessment tax returns is given a Unique Taxpayer Reference (UTR) number. When someone starts a limited company or becomes self-employed, this eligibility becomes active.
HMRC keeps track of each taxpayer’s returns using this special set of 10 numbers. Additionally, the taxpayers pay for their returns using this number. Most of the time, the tax reference number ends in the letter K.
A taxpayer uses a unique taxpayer reference number during their whole tax career. However, you shouldn’t panic if you misplace your UTR; all you need to do is get in touch with HMRC, and they will give it to you.
Personal UTRs get issued by HMRC automatically for any individual who signs up for self-assessment. The personal UTR number cannot be used for your business UTR number. That is to be kept separate. You will receive a different Unique Taxpayer Reference Number for your firm once it is completely formed.
It is to be noted that you do not have to work towards the registration of the Unique Taxpayer Reference Number. HMRC would be informed by the Companies Hose at a specific time, and in a few days, you will get a letter at your registered office address. This letter will have your UTR number and everything about your tax responsibilities.
The company UTR numbers come in handy to help the HMRC in identifying firms for all kinds of tax-based demands. You are required to keep your essential UTR number handy in the following cases:
- When you are in the phase of adjusting your business tax accounting
- When you are applying for PAYE or VAT
- When you are fulfilling your tax and VAT returns
- When you have to notify HMRC about business dormancy
- When you start paying your staff members
- When the need for contacting HMRC arises
Apart from being a mandatory requirement, UTR numbers also assist you in keeping track of your previous data and submitting new business details quite easily.
Who should have a UTR number?
The HMRC assigns this number to every person who is a taxpayer so that they can keep a record of their taxes. Every UTR number has 10 digits, and, in some situations, it ends with the alphabet ‘K.’
Any individual who is working as a paid employee, or has a business of his own, needs to register for tax self-assessment. Then he/she will receive a UTR number. Some examples of such business forms are:
- Sole Proprietors
- Limited businesses
In the case of a Limited Company, you will have to register for a company UTR number. The HMRC will be notified through Companies House, and then your firm will be assigned a UTR number. You will receive this UTR number in the form of a letter to your submitted official address. The letter will also have the suitable guidance you need regarding your tax liabilities.
What is the need for a UTR number?
While now you know what is UTR number, its types, and who should have it, it is now time for you to understand why do you need one?
All who submit Self-Assessment financial records, which indicate they’ve presumably established up a private limited company or are employed by their own require Unique Taxpayer Reference numbers. Reasons it is necessary to have a UTR number are as follows:
- You can pay federal income taxes in the accompanying directions: Since you’re employed on your own, you’ll need something for your self-assessment taxable income, and the business Unique Taxpayer Returns is needed to compute your business taxes.
- HMRC could keep track of the revenue authorities in the accompanying directions: HMRC used this citation to keep a record of the financial responsibilities, which would lead to a tax deduction if you have been overcharged.
- Companies may collaborate with accounting in the accompanying directions: To assist you with your files and tax arrangements, auditors and institutional investors will have to learn your UTR.
How to register for a UTR number?
The most obvious question that might be bugging you after knowing so much about the UTR number would be, how to apply for a UTR number? Don’t worry! We have the answers to all your questions.
A Unique Taxpayer Reference number of the United Kingdom (UK) will not be assigned to anyone instantaneously. To receive it, users must first enroll for identity by themselves. The steps to apply for a UTR number are as follows:
- HMRC utilizes your UTR number to recognize you for the times they are handling your tax payments, you must have proper tax data with you.
- It is easy to claim a UTR number in the UK once you have successfully applied for the self-assessment tax return. This whole process will consume a few weeks of your time, but once it is done you will get your UTR number delivered to you.
- You should keep in mind while forming a business, getting into employment, or even during partnerships that you will need a UTR number today or tomorrow. So, it is my suggestion that you should not wait till the last minute to get your UTR number. Get it as soon as possible.
- To give you an estimate, a few months before you start filing for your self-assessment tax is the best time to apply for a UTR number.
- If you choose Odint Consultancy for this application process of your UTR number, we will deliver an SA-1 form to you. You will have to sign the form and send it back.
- Another way to get an automatic United Kingdom’s (UK) UTR number is to form a Limited Company. But, in this case, you and your firm both will need separate UTRs. ODINT consulting will be there for you from the start till the very end until you get your UTR number.
- Once you have completed all the steps, the HMRC will send you a letter titled, “Welcome to Self-Assessment.” Under this headline, you will find your UTR number. The only way to receive your UTR is through the post.
- This process can consume up to 7 days. That is why we suggest you plan to apply for UTR a few months before you file your first tax return.
You also have an option to register yourself for HMRC’s online assistance. For this, you will have to submit your email and complete all the login requirements. Once done, you will be able to check your UTR online. So, team up with ODINT consulting today so that we can provide an effortless service quickly.
Data required to apply for a UTR number
A UTR number is needed for your identification, the data required is very basic and general. On applying for a UTR number, you will have to submit the data with the following information:
- Your birth date, name, and your permanent residential address
- Your email id and your contact details
- Your National Insurance Number (NIC)
- Your company’s contact number
- The date you started your self-employment journey on
- The name of your firm, address, and the kind of business you’re into
How to find a UTR number?
Moving in a sequence, now we have come to our next section, where we will understand how to find UTR numbers. Once you have collected all the needed information, applied for your UTR, and then finally, when you receive it, it may be tough for you to find your UTR number amongst the various documents from HMRC.
The various documents that you would get through HMRC are:
- Payment reminders
- File a Tax return notice
- Paperwork of self-assessment tax return
- The welcome letter
- Account statement
It would be easier for you to find a UTR number if you sign up for an account on the HMRC website. Once you sign up and make an account, you will be able to check your UTR number just by logging in to the site anytime.
How to trace back the lost UTR number?
In your busy lifestyle, you may lose your UTR number somewhere. But how to trace it back? Some of the ways how to trace back the lost UTR number are as follows:
- One thing you should keep in mind in such a case is that act quickly. Wasting more time will only cause you harm. So, it is better to take speedy measures.
- You can find your lost UTR number on your old tax returns and on other documents you receive by HMRC. For instance, the notices you get to file returns or on payment reminders. You can check these documents and trace back your UTR number.
- Another way to get back your lost UTR number is by logging in to your HMRC personal tax account.
What to do in case of failure of these measures?
What if you cannot find any of the above-mentioned documents, and you’ve not even signed up for the Personal Tax Account? In such scenarios you can do the following:
- You can ring up the self-assessment helpline and request your UTR number.
- If you own a limited company, you can file a request for your Corporate Tax UTR number online.
- The HMRC will deliver you your UTR number at your business address which was registered with the Companies House.
Different Types of Unique Numbers Issued by HMRC
Completing your self-assessment application and receiving your firm’s UK Unique Taxpayer Reference number is a simple process. Nevertheless, you must be careful not to mix up the unique numbers related to your business:
- Company Registration Number This name is provided to you after you start your business and is used to identify it. It typically consists of 8 numbers (for example, 48684698) or 2 letters followed by 6 digits.
- HMRC issues a VAT number to businesses that have applied for Value Added Tax. This sequence has 9 numbers with the addition of the prefix “GB” (e.g., GB48684698)
- HMRC issues an Employer reference number whenever an employer registers to use PAYE for its workers. The first 3 numbers of the reference indicate the tax department that is responsible for the relevant PAYE.
What should Freelancers working in a foreign nation do regarding UTR numbers?
The workplace is evolving, and people are increasingly recognizing that they do not require to be tethered to a desktop and can tour the globe by taking advantage of opportunities enabled remotely. If you work as a freelancer in another country, you’ll need to register for a UTR number to keep track of your tax liabilities.
So, if you’re a new freelancer in another country, the initial stage is to register for a Unique Taxpayer Reference number and open an HMRC profile. After you’ve established your accounts, keep a record of the fiscal year’s events as well as the timeframes for reporting and completing any payments.
Numerous freelancers are working abroad advantage of cost trading, which occurs. To take advantage of this, examine your foreign transfer charges to ensure you’re getting the maximum from your profits and not going bankrupt due to low exchange rates or hefty transfer fees.
If you are someone who is self-employed and has filed for self-assessment tax returns, or if you are an employee, you still need a UTR number. Once you get your UTR number, you can easily enjoy a lot of perks.
On issuing a UTR number, HMRC can pay attention to your tax liabilities, and it can utilize this information to trace your tax details. This can be beneficial to you in the form of a tax refund if you ever paid extra tax.
If you wish to know more about the UTR number or looking to file a tax return, you must seek advice from a professional expert from OnDemand International to help you in getting a better understanding of all.
It can be possible that you require a UTR even when you are not self-employed. For example, individuals who claim tax refunds usually need to register a self-assessment tax return to receive the money.
No, applying for a UTR number is free of cost.
Yes, you can check the documents delivered by HMRC and find your lost UTR number easily.
You should never divulge your UTR number to anyone unless they specifically require it, as there have been a few instances of scammers misusing someone else’s UTR to perpetrate identity theft.
Yes, a UTR number is required in order to correctly file your Self Assessment tax return. You require a UTR number if you are self-employed or the owner of a limited firm.
The UTR number is produced by the bank that starts the transaction. It is usually 16 or 22 characters long and comprises a mix of numbers and letters. The format of the UTR number varies depending on the bank, although it normally begins with the bank’s IFSC code.