Tax & NI second job self employed

rfazz

Hi
I work part-time as a school teacher. My yearly salary varies because I get supply work through my main employer but I earn enough to get me into the 20% bracket (a long way off 40%!)
I want to start tutoring children after school so for this I would be self-employed. Please can someone tell me how I have to go about the tax situation - I'm assuming I'll have to tell HMRC and fill in tax returns??

I'm less sure about the National Insurance situation - how does this work? Again my monthly income will vary depending on whether it's school holidays (less) but maximum would be about £400 pcm. I usually pay NI in my main job as, although my basic monthly pay is just below the threshold, any supply work takes me over it.

Thanks

fengirl_2

You need to register with HMRC within 3 months of starting. they will arrange for you to pay your class 2 NIC's by DD and will issue a self assessment to you at the end of the first tax year of trading. You will show your earnings and accounts on this and either work out the tax due or get HMRC to do it. Tax will be payable in Jan and July following the year of assessment.
If your self employed earnings are low, you can claim small earnings exemption - detials on HMRC website.

rfazz

Hi fengirl
Can you give me any idea of my NI liability, please? I read on another thread that you can earn £104 per week per job without paying - is that correct?

mrkbrrws

Class 2 NICs are £2.30 per week, but you can claim exemption if your self-employed profits will be under £4,825 per year.

Class 4 NICs are 8% of any self-employed profits over £5,435 per year.

These are the 2008/09 figures, from April 2009 they will be increased:
http://www.hmrc.gov.uk/rates/nic.htm