Employed and Self Employed Taxing

young-lecky · 9 July 2017 at 3:18PM

I currently have a job that's on minimum wage and around 38 hours a week, so I total between £14k and £15k a year. I'm paid weekly and my taxes and NI are paid by my employer.

I have recently been looking into getting a second job working from home that would require me to be self-employed.

I would be paid directly by the company weekly, with a top-line of pay at £9.30 an hour, with a minimum of 10, and maximum of 20 hours per week.

I have never been self-employed before, and looking online I see snippets of info but nothing that can tell me outright how I would go about paying taxes and NI, and how much I'd have to pay weekly/monthly/annually.

How do I go about paying tax on my extra income so that everything is done correctly?

Thanks in advance for any help.

Pennywise · 9 July 2017 at 3:24PM

young-lecky wrote: »

How do I go about paying tax on my extra income so that everything is done correctly?

Thanks in advance for any help.

You register as a business with HMRC for self assessment and then each year you declare your business income less business expenses on your self assessment tax return, along with your employment income and tax deducted from that, and the tax return gives you the amount of tax and NIC you're liable to pay.

TheCyclingProgrammer · 9 July 2017 at 3:30PM

Every time I hear about people taking jobs where they have to be taken on as self employed it sets off alarm bells for me.

What about the role makes you self employed? Are you effectively your own boss, free to decide how you do the job without any supervision direction and control?

Are you happy to be self employed? Considering you take on the extra burden of having to submit a tax return each year, keep records etc, you don't get holiday pay, sick pay and other employee rights and could effectively be told at any point you're no longer needed, are you happy with the level of compensation you are getting for your time?

young-lecky · 9 July 2017 at 3:43PM

Pennywise wrote: »

You register as a business with HMRC for self assessment and then each year you declare your business income less business expenses on your self assessment tax return, along with your employment income and tax deducted from that, and the tax return gives you the amount of tax and NIC you're liable to pay.

So I'd be paying tax as a total (On the SE job) annually, and they will tell me (after I've told the taxman what I've earned) how much I'd have to pay?

TheCyclingProgrammer wrote: »

Every time I hear about people taking jobs where they have to be taken on as self employed it sets off alarm bells for me.

What about the role makes you self employed? Are you effectively your own boss, free to decide how you do the job without any supervision direction and control?

Are you happy to be self employed? Considering you take on the extra burden of having to submit a tax return each year, keep records etc, you don't get holiday pay, sick pay and other employee rights and could effectively be told at any point you're no longer needed, are you happy with the level of compensation you are getting for your time?

Yes, I'm happy to be classed as self employed. They are a large American company that require people worldwide to review online data. I'd be allowed to do the work when I like, and how I like with no supervision whatsoever (other than being reviewed now and again on work complete to ensure they're happy with the quality). The only 'rule' that I'd have to keep to is that I have to do between 10 and 20 hours per week. I'd get to decide how I go about doing the hours, so long as they're complete.

00ec25 · 9 July 2017 at 4:34PM

young-lecky wrote: »

So I'd be paying tax as a total (On the SE job) annually, and they will tell me (after I've told the taxman what I've earned) how much I'd have to pay?

No, you will register with HMRC for an annual tax return

https://www.gov.uk/log-in-file-self-assessment-tax-return

you will declare both your employment earnings and self employment profit yourself having worked out what those figures are. When you submit the tax return the HMRC system will tell you how much to pay

"They" (whoever they are) won't tell you anything as they have nothing to do with it.

agrinnall · 9 July 2017 at 8:32PM

Basically you'll be required to pay 20% tax on the profits of your self employment (which may not be the same as your income) unless you earn enough when combined with your PAYE income to take you into a higher tax bracket. You may also have to pay additional National Insurance, but NI for the self employed is not something I know a great deal about.

Employed and Self Employed Taxing

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