In the UK, tax authorities must keep precise records of individual and business tax information. A key component of this system is the use of tax reference numbers, which help both taxpayers and HMRC track tax obligations accurately. If you’re new to UK taxation, you may have questions about what a tax reference number is, who needs one, and how to obtain it. This guide provides answers to these common questions and outlines the steps required to get a tax reference number from HMRC.
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What is a Tax Reference Number?
A tax reference number is a unique identifier issued by HMRC for individuals or businesses in the UK to help track their tax affairs. There are different types of tax reference numbers:
- Unique Taxpayer Reference (UTR): This is a 10-digit code issued to individuals and businesses who need to file a self-assessment tax return, such as self-employed individuals, limited company directors, or others with specific tax circumstances.
- Employer PAYE Reference: This is issued to employers when they register for the PAYE system (Pay As You Earn) and is typically found on employee payslips, P60s, or P45s.
These numbers play a crucial role in ensuring that tax records are accurately maintained and that taxes are paid and recorded correctly.
Who Needs a UTR Number?
Not everyone in the UK needs a UTR. You will need a UTR if you meet the conditions for filing a self-assessment tax return, such as if you are:
- Self-employed or a sole trader;
- A director of a limited company;
- A person receiving income from property, investments, or other sources not covered by PAYE;
- Required to file a return due to capital gains, dividends, or other income types.
However, if you’re only employed by a company and pay tax through PAYE, you generally will not need a UTR, as your employer’s PAYE Reference will suffice for tax purposes.
How to Obtain a UTR Number from HMRC
If you need a UTR, here are the common ways to register and obtain one:
- Online Registration:
- The fastest way to register for a UTR is via the HMRC website. New businesses or self-employed individuals can complete the registration for self-assessment online. Once registered, HMRC will issue a UTR and send it to you by post within 10 working days (or 21 days if you’re abroad).
- Contact by Post:
- You can also write to HMRC to request your UTR, though this method tends to be slower and may involve back-and-forth communication. Letters can take longer to process, so it’s usually recommended only if online access is not an option.
- By Phone:
- Another option is to contact HMRC by phone. While they can confirm some tax information over the phone, you will still need to complete the self-assessment registration to receive your UTR if you don’t already have one.
What is the Information Required to Register for a UTR?
When applying for a UTR, you’ll need to provide HMRC with some basic personal and business information:
- Your full name and date of birth
- National Insurance Number
- Current address and contact details (email and phone number)
If registering as a business, you will also need:
- Business address and contact details
- Type of business
- Start date of the business
Providing accurate information will help avoid delays in receiving your UTR.
Where to Find Your Tax Reference Numbers
Once issued, your UTR will appear on key tax documents, including any correspondence from HMRC regarding self-assessment, tax returns, and payment reminders. The PAYE Reference for employees is often found on payslips, P60s, or P45s, and it remains linked to your employer rather than being unique to you.
How Long Will It Take to Get a UTR?
After submitting a registration, HMRC typically issues a UTR within 10 working days if you are in the UK. If you’re based abroad, the process may take up to 21 working days. It’s advisable to apply as soon as possible once you know you need a UTR to avoid delays, especially if you are approaching a tax deadline.
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Summary
A tax reference number is essential for tracking and managing your tax records, particularly if you’re self-employed, run a business, or have additional sources of income that require self-assessment. For most people, obtaining a UTR is straightforward once they register with HMRC, and it becomes a permanent identifier for future tax affairs. By following the methods above, you can obtain your tax reference number and stay on track with your obligations.
Disclaimer: The information about Tax Reference Number provided in this blog includes text and graphics in general. It does not intend to disregard any of the professional advice.
