Proof of Income for a Self-employed Mortgage

For people who are registered self-employed with HMRC and submit a tax return each year, the SA302 is a summary of your year-end tax calculation, confirming the amount of income you have declared to HMRC for the tax year from 6 April to 5 April. For mortgage lenders, this provides required documentary evidence of your declared income, to comply with mortgage affordability rules set down by the Financial Conduct Authority (FCA) and to allow them to assess your mortgage application.

The SA302 tax calculation is a high-level overview and summary of the information you have provided on your tax return, and the amount you have to pay to HMRC for the relevant tax year. It shows the total of your declared income received from all sources including any salary, income from self-employment or partnerships, limited company dividends and interest. Your personal allowance and the total income on which tax is due are also shown. The tax calculation itself breaks down the income tax due and the applicable rates. It also shows the applicable National Insurance contributions due for the tax year.

HMRC’s systems can provide the past four years of SA302 tax calculations and corresponding tax year overviews – we recommend checking with the lender or your mortgage broker how many years are required, but if in doubt you are best obtaining the maximum four years’ worth (typically lenders will ask for up to three years, but this can vary between individual lenders).

There are various ways you can obtain these, depending on how you submit your tax return. If you submit your tax returns via HMRC’s online Self Assessment gateway, you can print out your SA302 calculations and corresponding tax year overviews directly from the online system. If you use commercial software to submit your tax return, then the tax calculation can be printed from the software. If an accountant submits your tax return on your behalf, then you should contact them for a copy.

At the time of writing, over 50 lenders accept SA302s that have been printed out from HMRC’s online system or commercial software, for the purposes of income verification for self-employed applicants. However, others may only accept original SA302s provided by HMRC. If this is the case, if you do not have a printer, or if you submit your tax return by post instead of online, then you can ask HMRC to send you your SA302 tax calculation.

You can request your SA302 by calling the HMRC Self Assessment helpline on 0300 200 3310, or by writing to Self Assessment, HM Revenue and Customs, BX9 1AS, quoting your National Insurance number and Unique Taxpayer Reference (UTR). You should allow up to two weeks for the tax calculation to arrive, so it is important to take this into account when considering mortgage application timescales.

At Just Mortgage Brokers we have years of experience in helping secure mortgages for the self-employed, contractors and freelancers. We work closely with lenders to understand what documents they need for income verification for self-employed people, and can help you find the mortgage deal that is right for you. Contact us today to discuss how we can help.