PSC question on self assessment tax return

18th January 2013
Written by Qdos Contractor

Firstly, a timely reminder that your Self Assessment return must be filed on or before 31st January (not that it’s likely that any of you would forget). You must also remember to pay any tax by 31st January to avoid interest being charged and definitely before 28th February, otherwise a 5% penalty will be levied on any unpaid tax at that date.


Secondly we’ll just provide our annual clarification of the ‘Service Companies’ question, which creates confusion every year.


The section should be completed if:


  • you performed your services (intellectual, manual or a mixture of both) for a client (or clients), and
  • the services were provided under a contract between the client(s) and a company of which you were, at any time during the tax year, a shareholder, and
  • the company's income was, at any time during the tax year, derived wholly or mainly (i.e. more than half of it) from services performed by the shareholders personally. 

The majority of limited company contractors are, by definition, ‘personal service companies’ and therefore this box is of relevance.


The question however has no statutory backing and you cannot be penalised for failing or refusing to answer it but if contractors ignore the question when HMRC know full well that their company is a ‘service company’ then they may be drawing unnecessary attention to themselves.


The information to be entered is the total of the gross salary and dividends taken from the contractor’s company in the year ended 5th April 2012.


If you have any further queries please feel free to contact us.


Qdos Contractor
Written by
Qdos Contractor
Award-winning providers of insurance for the self-employed, Qdos are the leading authority on IR35, offering industry-leading employment status services to ensure the flexible working industry thrive. Qdos are the Best Contractor Insurance Provider 2022 and won the Queen’s Award for Enterprise in Innovation 2022 and 2017. 

Have a question?

Ask away! One of our team will get back to you!

Prefer to talk to us in person?

Call our team on 0116 269 0999 or we can call you back at a time that suits you!