What is a UTR Code?

Most self-employed people will be aware that they have to file their tax returns each year. To do this, you will need a UTR, otherwise known as a Unique Taxpayer Reference number, which means that HMRC can identify you. You may also need this if you pay tax via CIS (Construction Industry Scheme), in which a contractor may take tax out of a sub-contractor's payment and forward it to HMRC.

Your UTR is important for identification. With a UTR, the tax office always knows exactly who they are dealing with. Getting a UTR is not difficult. When you sign up to provide a self-assessment tax return, you will generally be given a UTR. The UTR has 10 digits and you will need this when filing a return and also if you plan to claim any tax rebates.

Getting your UTR is generally quite straightforward, but to prevent fraud, there are a number of security steps you will need to complete. You can do this online and provide the necessary identification in response to questions. When all of this is done, the tax office will send your UTR to you in the post. A physical address where post can be sent is part of the process.

It’s best not to leave all of this to the last minute if you need a UTR to file a return as the verification process can take several weeks and there are a number of steps to complete. Eventually, you will receive your login details and then you can go online and check that your UTR and other details are all accurate and then file your return and do whatever else you need to do. At the minimum, you will probably need at least 10 working days to satisfy all the criteria necessary to get your UTR.

What you need to get a UTR

When applying for your UTR, various items of information are required. These will include your address, when you were born and where you live (postal address). You will also need your National Insurance number. You will need a phone number and an email address, and the details of your business or self-employment. You will need to supply details of the nature of the employment, where it’s based, a phone number for the business and the date that you became self-employed.

The essential steps that take place will occur in this order:

. Register and apply online with HMRC, providing all necessary ID.
. HMRC will post your UTR
. When you have your UTR you can finish registering for tax self-assessment
. HMRC will then post an activation code to you to make your UTR active
. You then need to activate your account and you will have 28 days in which to do this

A tax reference number or tax code and a UTR are different things. Generally, you’ll find a tax reference number on payslips when you are issued your salary by an employer. A tax reference number will also appear on a P60, the document an employer issues at the end of a tax year to show how much you were paid in this time, how much tax you paid and how much National Insurance you paid. The tax reference number will also appear on a P45, which is the tax document you are issued when your employment comes to an end.

You only get a UTR when you register for self-assessment and is related to your business. A tax reference or tax code is a combination of numbers and letters that informs the HMRC of individual circumstances related to your tax situation and what kind of personal allowance you have.

A UTR is essential if you need to file a tax return as a self-employed person or register with CIS. If you want to make a claim for a tax return related to business expenses, then you will need a UTR. Even if you are a PAYE taxpayer, you may also need a UTR if you earn money on the side, for example, through renting property. If you are part of a business partnership, you will need a UTR, as will the business and other partners.

Not having a UTR could lead to penalties in some cases if you are involved in business activities and not paying the appropriate tax.

Once you have your UTR, it will appear on a number of official communications with HMRC. You will receive an SA250 letter that welcomes you to self-assessment and your UTR will appear on this. Your UTR will also appear on all the paperwork you complete for self-assessment, and the notice to file a tax return. Your UTR will appear on account statements and any reminders you receive of tax owed or payments that need to be made. When you make claims for refunds, you will need your UTR for this too.