Tax help...

MikeF1968

Hi,

New forum user..

I'd just like to pick your brains here. I was working for a bank up until last April paying tax by PAYE. I have a P45. Since then I have been self-employed freelancing. I informed HMRC that I was self-employed starting on 1 June 08. Now with the recession I will be working for a friend of mine part-time whilst still, on and off, doing my freelancing work.

How does this affect how I pay tax?? Do I go back to PAYE and declare my freelancing as extra??



Thanks in advance for your advice and input...

Mike

CLAPTON

are you on PAYE whilst working with your friend?

MikeF1968

CLAPTON wrote: »

are you on PAYE whilst working with your friend?

Yes, I would imagine so... - I haven't started there yet.

CLAPTON

MikeF1968 wrote: »

Yes, I would imagine so... - I haven't started there yet.

If you are doing two employments, one PAYE and one self employed then that's simply how it is..The PAYE one will deduct tax and NI at source and you will need to fill in sell assessment forms after April each year.

MikeF1968

CLAPTON wrote: »

If you are doing two employments, one PAYE and one self employed then that's simply how it is..The PAYE one will deduct tax and NI at source and you will need to fill in sell assessment forms after April each year.

Thanks, so do I have to inform HMRC that I'm changing to PAYE and also filling in a SA or do I just hand my P45 to my new employer and HMRC has me down as PAYE and self-employed so they still send me an SA?

CLAPTON

As you have already told the HMRC that you are self employed they will send you a form after April.
Once you start PAYE employment then you hand your P45 (if this tax year) and they will deduct tax and NI at source.
There is nothing particularly unusual; quite a lot of people have a PAYE job and also work self employed.

MikeF1968

CLAPTON wrote: »

As you have already told the HMRC that you are self employed they will send you a form after April.
Once you start PAYE employment then you hand your P45 (if this tax year) and they will deduct tax and NI at source.
There is nothing particularly unusual; quite a lot of people have a PAYE job and also work self employed.

Thanks for your help.

tyllwyd

When the time comes to fill in your tax return, you fill in both the employment and the self-employment pages with the relevant figures, and then when HMRC do the calculation they take into account the tax you've already paid when they calculate your final tax bill for the year. (In fact, you'll need to do that anyway for this tax year to take account of your employment from April to May 2008.)

I guess you are paying Class 2 NI at the moment? I always get confused about the rules on National Insurance when you have two jobs, but you might want to look into it so that you pay the right amount.

MikeF1968

tyllwyd wrote: »

When the time comes to fill in your tax return, you fill in both the employment and the self-employment pages with the relevant figures, and then when HMRC do the calculation they take into account the tax you've already paid when they calculate your final tax bill for the year. (In fact, you'll need to do that anyway for this tax year to take account of your employment from April to May 2008.)

I guess you are paying Class 2 NI at the moment? I always get confused about the rules on National Insurance when you have two jobs, but you might want to look into it so that you pay the right amount.

Right, OK... Yes I left the bank on April 21st and didn't start self-employment until June 1st. So I've been paying just Class 2 NI since June 1st too. I'm sure it'll be self-explanatory when I receive my SA...

Is there anywhere on the web that has this info? The HMRC site seems to just deal with if you're either employed or self-employed and not both...

tyllwyd

MikeF1968 wrote: »

So I've been paying just Class 2 NI since June 1st too. I'm sure it'll be self-explanatory when I receive my SA...

No need to worry about that for this year - you don't need to do anything more about the class 2 contributions, and when you eventually do your tax return it will calculate any class 4 NI contributions automatically, you don't need to worry about it separately.

It is a nightmare trying to find out about NI - I'm sure that someone else on the forum will be able to help more than me. This is what I was thinking of
http://www.business-scene.com/view_article.php?a=336