Opt out of PAYE

wdywuk

Silly question...but is it possible to opt out of PAYE
(ie pay the tax and or NI due in July/January like a self-employed person)???

I'm employed through 1 fixed employer at the moment, and just thinking about it from a cashflow/stoozing point of view.

NeilW

Silly question...but is it possible to opt out of PAYE

The short answer is no, not easily.

The long answer is that you can if you alter your status to one of self-employed. However you've got to know what you are doing.

NeilW

sarahlouise210

NeilW wrote:

The short answer is no, not easily.

The long answer is that you can if you alter your status to one of self-employed. However you've got to know what you are doing.

NeilW

I would be interested in a breakdown of the long answer! Employment status cannot be decided by an individual even if you know what you are doing! If you an employee, working for an employer with a contract of employment - you are an employee and will be dealt with as such and PAYE will be deducted. You can always set yourself up as Self Employed as well but you would only pay the tax on the Self Employment in January and July - not the PAYE employment.

NeilW

Employment status cannot be decided by an individual even if you know what you are doing!

No, but it can effectively be decided by negotiation between two persons who are contracting with each other - again as long as they know what they are doing and appreciate the difference that need to be put in place and observed to create a self-employed relationship.

NeilW

sarahlouise210

NeilW wrote:

No, but it can effectively be decided by negotiation between two persons who are contracting with each other - again as long as they know what they are doing and appreciate the difference that need to be put in place and observed to create a self-employed relationship.

NeilW

true...but that would only apply to an employment that had the scope to be classed as Self Employed. If someone is already paying PAYE then they are employed. The majority of people on PAYE have jobs that just would not be accepted as Self Employed and work for employers who are just what they say..employers. It is my understanding the OP has a regular job, employed by an employer..can he opt out of PAYE(ie become self employed) and remain in that job?? Almost certainly not

smartie1976

My partner is Full time employed, by a council, and is PAYE.
The tax man makes her fill in tax returns every year, which is a pain in the *rse, because they always say her PAYE has been underpaid!

Is there any way she can get out of doing these tax returns (she earns +40k)

isasmurf

She should no longer need to fill out a tax return if her only income is from her wages and savings - unless savings income is more than £10,000.

reddevilled

isasmurf wrote:

She should no longer need to fill out a tax return if her only income is from her wages and savings - unless savings income is more than £10,000.

Of course she does!!! Where do you get that from !!!!

If she is issued with a self assessment tax return she has a legal obligation to fill one in or risk fines from HMRC.

If you believe that she has all her tax collected at source by all means request that she is no longer issued with a return, but if she is issued with a return she must fill it in and return it.

reddevilled

smartie1976 wrote:

My partner is Full time employed, by a council, and is PAYE.
The tax man makes her fill in tax returns every year, which is a pain in the *rse, because they always say her PAYE has been underpaid!

Is there any way she can get out of doing these tax returns (she earns +40k)

When you fill in her next return request that they no longer issue a self assessment tax return, but no not ignore tax returns already issued to them or not inform them if you think she should pay some extra tax. The emphasis is on SELF assessment and believe me the HMRC stick to this!!!!

Ems!

reddevilled wrote:

Of course she does!!! Where do you get that from !!!!

If she is issued with a self assessment tax return she has a legal obligation to fill one in or risk fines from HMRC.

If you believe that she has all her tax collected at source by all means request that she is no longer issued with a return, but if she is issued with a return she must fill it in and return it.

I think that isasmurf might have meant that in the last yr (or maybe 2 ) , HMRC have changed the criteria of who gets a tax return - whereas previously everyone who was a higher rate tax payer would receive one, they have stopped sending them to many HR tax payers now - but you would receive a letter telling you that they were going to stop sending you one and the reason why. Like you say, you can also request they stop sending you one and see what happens!