Self-assessment: have I got it right?

toby_puppy

Sorry, meant to say that's a basic template we use to calculate tax at work - it is considerably simpler than using the booklet supplied by Inland Revenue.
This is the 07/08 template, you might need to replace the figures with the relevant for 08/09

ALIBOBSY

Ok had a look at futurelinks website. It would appear you are working as a sole trader useing them to submit invoices as a limited company for which you pay them £100 per month ie 1200 per year.
It would be far more tax efficient to set up your own limited company and do your own invoices surely? Even using a local accountant (who will do far more work for you than them) you should be well under that figure.

good luck

ali x

tax_rookie

Thanks for the replies,

ALIBOBSY - what do you suppose I do then re: collecting my own invoices? Do you mean setting up a limited company or something like that?

jostenning - thanks for the template. I'll try and work it out :-/

Sorry, as you can tell I'm quite new to all of this!

toby_puppy

tax_rookie wrote: »

I also understand that I have to pay the statement of account for the 08/09 tax year - 50% of the 07/08 return on jan 31 and another 50% on July 31? Meaning I'd owe £6,366 in total on Jan 31 and then another £2,122 on July 31. Yes/No?

Not sure what role NI deductions play but class 2 deductions have been taken out every month via direct debit (about £9-12 per month I think)

Correct

Class 2 deductions are separate from class 4 NIC.
Class 4 NIC are payable on profits and form part of your annual tax bill - the direct debits don't need to be used for the calculation you are doing.

Quentin

You really need to get some advice on self employment - there are pros and cons to setting up a ltd company (and you don't need to be one to issue your own invoices).

tax_rookie

Thanks Quentin,

Any suggestions as to where I should look to for advice?

Should I make an appointment with an accountant etc? Or does anyone know of useful websites etc I could browse?

Quentin

Yes an accountant is ideal - get a recommendation for one from friends.

Your library will have books on "going self employed", and there may be local self employed associations with help/advice.

Stompa

tax_rookie wrote: »

Is there a quick link someone can send me that will work out my tax for me before I submit this return?

As I suggested previously, just do it online at the HMRC website. You can fill in the numbers and ask for it to perform the calculation without having to submit the return. It'll save the numbers you've entered so that you can go back and edit them further at a later date if required. Then hit the Submit button when you've finally got everything right.

tax_rookie

Thought so - will look into it

How do I issue my own invoices without setting up a limited company? I'm interested to know...

toby_puppy

Tax calculation 2008/09
Self employed income
Other income

Deduct
Personal allowance 6035
GROSS Pension Contributions _________________

Income tax

Standard rate 20%
£0 - £36000
Standard rate limit 36000_____________
Higher rate 40%
Over £36000

Class 4 nic
Self employed income
Less lower limit 6035
Subtotal
Liable at 8% max 34605 …………
Balance at 1% …………………………….