SA302s for Mortgages

If you need your SA302s for a mortgage, they are found by logging into your HMRC self-assessment account. Sa302s are used to prove your income if you are self employed income. There is also a supporting document called a Tax year overview which can further validate the information in your SA302s.

In this insight, we will cover all you need to know about using an Sa302s for a mortgage and how the lenders assess them.

Key Takeaways

• Most lenders ask for 3 years worth of SA302s for a mortgage.
• SA302s are easy to get hold of through your online HMRC account.
• The income on the SA302 is the profit figure you submitted, plus any dividends and rental income.
• Some lenders will accept a minimum of 1 years SA302s in exceptional circumstances, with supplementary evidence requirements.

What is a SA302?

The SA302 is used to prove income from self-employment. If you are self-employed, or run a small business as a sole trader, the document will be requested by lenders. If you are not doing a tax return, you will not be able to see anything more on your SA302 than your income from employment.

The SA302 includes all income declared within the tax period and you can go back as far as 4 years ago.

What Income types are Included on the SA302?

The SA302 includes all different types of income that have been declared to HMRC for tax purposes, these include incomes from:

• Employment
• Self-employment
• Dividends, including from self-employment
• Rental income profit

Other details on an SA302:

• Your personal allowance amounts
• The calculations of your income tax

SA302 for Mortgages

When assessing personal income for a self-employed applicant, an SA302 is a safe way for lenders to validate income. These figures are confirmed by HMRC, and these are the figures the applicant has paid tax on.

It does have its pitfalls as an applicant though. As the SA302 is a personal tax-year overview, for some they may choose to retain money in the business, or include further costs to reduce the overall profit figure. This ultimate profits figure is not only the amount the applicant has paid tax on, but also the income that is used to determine how much they can borrow. However, the SA302 can also include dividends and rental income.

Here is an example of what an SA302 looks like:

How many years' worth of SA302 is required?

Most lenders request 3 years worth of SA320s for a mortgage. They calculate your income by taking an average across the 3 years. If only 2 years are available, fewer lenders will help, but it is still possible with supplementary evidence and an underwriters referral. Supplementary evidence could include:

• Details of future contracts
• Company accounts
• Bank statements.

Your lender will let you know what specific income evidence is required.

How to Get SA302s Online

Obtaining your SA302s can take sometimes take a couple of weeks, so apply at the start of the mortgage process. You need to wait 72 hours after completing your tax return before it becomes available.

If your returns were submitted online, you can simply log in to your HMRC online account print your SA302 form, and your Tax Year Overview. Printing is instant and is the quickest way to obtain the documents.

1. log in to HMRC online portal using your government gateway details: HMRC SA302 Gateway
2. Click through to Self-assessment
3. Click 'more self-assessment details'
4. Choose "Get your SA302 Tax calculation"
5. View and print your calculation.

If you or your accountant filed a paper return, you can contact HMRC via phone on 0300 200 3310. You need your national insurance number and your Unique Taxpayer Reference (UTR). HMRC will then send you your documents by post.

Finally, if you use accounting software, or your accountant does. A copy of your SA302s can usually be printed from here. It is normally available in your tax breakdown dashboard. This includes SAGE, XERO & FreshBooks.

There are some lenders who may not accept the accountant software format of SA302 so it is advisable to obtain them directly through HMRC.

Is SA302 only used for Self-employed income?

If you are employed, the preferred method of income verification would be to use your Payslips.

You can use SA302s to verify rental income also. If you choose verify rental income this way, the income figure may be lower. This is because it provides your profit. The income after deductions. For rental income bank statements confirming the last 3 months' rent would also be acceptable

Are SA302s available for contractors and freelancers?

SA302s are available for anyone who is submitting a self-assessment tax return, including contractors and freelancers.

If you are not doing a return, your SA302 will not display your income. 

Not having evidence of your income would make it difficult to have a mortgage accepted as in most cases it is required. However, one exception to this is applying for a Product Transfer.

A product transfer does not normally require income verification. 

Self-Employed Specialist Mortgage Advisers

If you are self-employed and looking for advice, speaking to a mortgage adviser is a good idea. They will have access to a wide range of lenders, who have different policies. By doing so you will increase your chances of acceptance.

If you are not sure where to start, you can complete our Sunny Fact Find for Self employed Mortgages. The answers you provide us will be used to help us find the most suitable adviser. You will then be contacted for a no obligation conversation around how a mortgage adviser can help. You decide how to proceed.