
A common question we get at Xenith Wealth is:
Short answer? Often yes.
Long answer? It depends on why you’re registered and what HMRC expects from you.
Let’s break it down in a clear, no-nonsense way.
Once HMRC issues a notice to file, you’re legally required to submit a tax return — even if you earned nothing, made a loss, or didn’t trade at all.
Why? Because HMRC wants confirmation of your situation, not assumptions.
Failing to file can still trigger penalties, despite £0 tax being due. Unfair? A bit. Avoidable? Absolutely.
a) You did trade but made no profit = You must file. HMRC still wants the figures, even if they show a loss.
Bonus: Business losses can often be carried forward, reducing future tax.
b) You didn’t trade at all (dormant business) = You may NOT need to file — but only if HMRC agrees you are dormant and removes you from the Self-Assessment system.
If HMRC hasn’t confirmed dormancy, you still need to file.
If your total self-employed income was under £1,000, you may not need to register for Self-Assessment at all thanks to the Trading Allowance.
However:
• If you’re already registered, you must still file unless HMRC tells you otherwise.
• If HMRC has asked for a return, you must file — trading allowance or not.
For UK companies:
• A Company Tax Return (CT600) is required every year, even if you made zero profit.
• If the company is dormant, you must notify HMRC. They’ll confirm if CT600s are paused.
Important: Companies House still requires annual filings, dormant or not.
If you’re a landlord:
• You must file if HMRC issued a notice or if you received more than £1,000 in rental income.
• You must also file if you want to declare a rental loss for future offset.
No profit doesn’t mean no admin.
Filing a return when your numbers are low or negative can actually benefit you:
• Banking losses for future tax relief
• Clean HMRC record (reduces risk of compliance checks)
• Proof of income history for mortgages, visas, funding, etc.
• Avoiding penalties from misunderstood obligations
Sometimes the easiest tax bill is the one that shows your year wasn’t great — and HMRC respects honesty.
At Xenith Wealth, we don’t believe in pointless admin.
We’ll quickly establish:
• Whether you genuinely need to file
• Whether HMRC can remove you from the system
• Whether it’s smarter to file anyway to protect future tax positions
Need clarity on your specific situation? A quick chat with us can save you both compliance headaches and unexpected penalties.