Tax for a Private Hire Taxi driver

yas1320

Hi

Can anyone help me?

I have a full time job with a telecommunication company. Now i have also a Private Hire Taxi badge. So, in the weekends i will be doing taxi's. I was wondering how i would be pay tax for this extra income?

Can anyone help?

Thanks

yas130

brightonman123

most likely full tax due on 2nd job, unless you are 'off the books' ?!

not sure, but may be able to use any unused tax allowance from wife?

Gorgeous_George

PAYE for the first job.

Second job. Calculate your income (fares and tips). Subtract allowable expenses (car maintenance, fuel, depreciation, insurance etc., I guess) to work out your profit. You add the profit to your 1st income and pay tax at the relevant rate.

The local tax office will advise.

GG

yas1320

thanks thats really helpful

CLAPTON

you need to inform the HMRC within three months of starting

you will probably need to pay class2 NI contributions by direct debit

you need to fill in a tax form by Ocober 2009 if you want to summit a paper return or by January 2010 (and pay) if you submit electronically online

depending upon your full time job you will probably pay 20% tax on your profit plus class 4 NI.

big_gay_kirk

will you be doing the private hire as an employee of an existing firm, or as a self employed person? If the former, the firms accounts dept should sort your tax out.. if the latter you will need to fill in a form SE1.. and set up a dd to pay class two NI.. which iirc is a flat rate, plus possibly class 4 which are calculated as a%age of self emplloyed income.... try these....

http://www.hmrc.gov.uk/businesses/tmastarting-up-in-business.shtml

http://www.hmrc.gov.uk/leaflets/se1.pdf

mtem74

if you're employed and self employed (as a taxi driver) then you may get an exception form for paying class 2 NIC depending on what you expect your profit to be (turnover less expenses)
If in doubt call the self employed helpline for more advice

yas1320

Thanks guys, you've been very helpful.

Mary_Hartnell

Please DON'T confuse Taxi drivers with Private Hire drivers.

Taxi Drivers are licensed by the local authority, their cab is probably MOT'd twice a year, they have to pass the "knowledge" and can lose their right to work as a Taxi driver.
"Private Hire" might be treated the same way depending on the local authority or might be a foreigner with a dodgy foreign licence - really no more than a white van man with a cargo of people.
The terms are not interchangeable.

However to get back on thread, the tax allowances probably are interchangeable.
The original poster does not explain how self employed he will be.
In the Private Hire game many people are employees in all but name. At the end of the month the controller's firm will print an invoice that appears to come from the driver for work done and pay it.
Not a lot of need for an accountant in those circumstances. A few quid for mobile phone, maps, satnav etc. in the expenses perhaps; plus the dodgy area of fines not being allowable?

Penny_Rich

The basic personal tax allowance isn't interchangeable between spouses i'm afraid. If you are self-employed and your spouse helps in your business, taking bookings, doing paperwork, that sort of thing, then you can pay her a reasonable wage that is comesurate with the role, and is tax deductible from your taxi income. If she doesn't exceed her personal allowances then she doesnt have any tax to pay, although i'm not sure if you would have to operate a formal payroll scheme for her.

The form you need to complete to register as self employed is a CWF1, and this covers national insurance as well as tax. The SE1 is the self employed section of the Self Assessment Tax Return.

Sailor_Sam

I use to drive a hackney and the privates here worked similar to us,except the privates had to have a radio, most hacks had them but did'nt have to.
The driver paid his 'settle', that is he paid for just the hire of the radio, or some used cars belonging to the radio company, so their settle was in effect the rental of a car and radio, any cash they took was their own, nothing to do with the radio company, they did'nt care if you did any work or not, they were already getting money off you.
Now i don't know how to say this but.........
everyone thinks taxi drivers earn a fortune, i've even heard it suggested that the figure they tell the taxman for takings is less than they have actually taken.
This is rumour and heresay, all taxi drivers are honest, all tell the tax man the truth.
Now we understand that, ask the other drivers 'how much '
they earn for their books, you will find, that by pure coincidence everyone will earn exactly the same.
I hope you can understand what i am trying to say.