What is HMRC?

HMRC (His Majesty's Revenue and Customs) is the UK's tax, payments, and customs authority. It was formed in 2005 by the merger of the Inland Revenue and HM Customs and Excise.

As a freelancer or business owner, you interact with HMRC for:

• Income tax: Through self-assessment tax returns
• VAT: Registration, returns, and payments if your turnover exceeds the £90,000 threshold
• National Insurance: Class 2 and Class 4 contributions
• PAYE: If you employ staff
• Making Tax Digital: Digital record-keeping and reporting

Key HMRC services and tools for freelancers:

• Government Gateway: Your online account for filing returns and managing your tax
• HMRC app: Check your tax position, make payments, and get updates
• Self-assessment helpline: 0300 200 3310 (for general self-assessment queries)
• Online chat: Available through the HMRC website for certain queries

HMRC has significant powers to enforce compliance, including issuing penalties for late filing or payment, conducting investigations, and charging interest on overdue tax. However, they also offer payment plans (Time to Pay arrangements) if you are struggling to pay your tax bill on time.

Keeping accurate records — including all invoices, receipts, and bank statements — is the best way to stay on the right side of HMRC. You must retain records for at least five years after the 31 January submission deadline for the relevant tax year.