UTR question - very small income

pool31

I have read through loads of discussions on here but nothing specific to this question, maybe someone can help?

My wife is employed in one job but is also delivering a parenting course in our local area, this is completely separate from her employment. The funding for the course comes via the local health authority and they are requesting a UTR so she can receive the £400 pay.

These courses are run by parents for parents and most of the people running them are at home looking after their own young children. I presume the simple answer is yes, they do need to all register as self-employed sole traders but it seems overkill when an accountant might charge them minimum £100 to sort out the tax return. Yes they could do it themselves online but if you have never done this before it is extremely daunting.

Any advice? Most parents only deliver 1 or maximum 2 courses each year.

mountainofdebt

A UTR - or Unique Tax Reference - is something that will be allocated to your wife when she registers as self emloyed - and this can be done with a phone call - to the Inland Reveue.

All it means is that your wife will have to fill in a self assesment tax form each year - and to be honest it is so easy to do it now that you can do it on line, a child could do it - far more easier than the paper version.

Your wife will have to pay tax on this income and this is the only way that it can be done unfortuantely, so she will have the choice of doing the work and filling in a tax return or not doing the work.

pool31

many thanks for the reply. If self assessment online is as easy as you say then hopefully it should work out ok.

fengirl_2

On no account give out your UTR to anyone - this is none of the business of the LA. If the job is genuinely self employment, then they need to make that decision and pay her gross. If they have any doubts about the status of the job they are giving her, then they need to decuct tax.
Having a UTR does not prove that you are self employed and it does not make you self employed in that particular position.
People who are higher rate taxpayers, some pensioners, directors and people with income from property have UTR's but they are not self employed.
As the jobs are very casual, I would advise her not to register as self employed but to write to the tax office at the end of the year asking for a self assessment. She can then declare the training income as casual fees. She wont be liable to class 2 NIC anyway, so she is not avoiding anything.

pool31

thanks fengirl, my wife doesn't have a UTR number anyway but the health authority are saying that they will only pay once they see it, I presume they are covering their backs, in previous years they have apparently paid the money without a UTR.

I guess a letter to the health authority explaining why she will not be providing a UTR might be the next step.

mountainofdebt

OP - I can understand why your wife needs to show her UTR and why she shouldn't but it sounds as if the LHB need to see the UTR to statisfy themselves that your wife has registered as self employed...otherwise it may look as if they are condoning cash in hand jobs.

WHy don't your wife register as self employed and then show the LHB a letter from the IR confirming that she has registered.

fengirl_2

I dont agree - having a UTR does not make you self employed and the LA has no right to withold payment in the absence of such a number. Its up to them to decide on the status of the job, the circumstances of the worker have no bearing on this. Having a UTR does not absolve the employer from operating PAYE if the circumstances of the employment require it.

pool31

my wife has just told me they actually asked for a 'self-employed number'. I am not sure what this is other than a UTR. In this circumstance it actually effects a number of parents, most of whom are not employed and this payment of about £400 would be their only income for the year.

There is no doubt this work is self-employed and therefore I think probably better for the health authority to advice they simply declare it as 'casual fees' as fengirl put it.

Once you register as self-employed does that mean you have to do a tax return from then on? What if this was a one of payment and in subsequent years there was no more? I know this sounds strange but the idea of this training is empowering parents to help other parents and the courses a really one of things, hence the very small income.

missm29

My other half is in the building trade, an utr is unique tax reference, thats what you get when you register for self employment, when i do the wages for our subcontractors i need this utr number and their national insurance no, i phone the tax office and they tell me when to deduct 20% 30% or nothing. they give me a verification code and i issue a payment statement each month saying what tax has been deducted. If they do not have a utr and still want me to pay them rather than waiting until they get one, can take a few weeks. i contact the tax office with their address and national insurance no and they tell me to deduct at 30% the higher rate, they need the verification code to claim back any tax, not sure if they can do this mid year or when they do they're tax return.

By being self employed she will need to do a tax return but if shes only done a few jobs it will be very simple, the form looks scarey but most of it you leave blank. My dad registered as self employed when we first started out so he could work the odd days we needed him, he was also employed, he earnt under 1k, then due to his old age and bad back he stopped working with us, phoned the tax office de-registered as self employed, his tax return for that year was simple.

missm29

Also i do the paperwork for my otherhalf and pay myself 100 per wk, 5200 a year, so its tax free, our accountant said to do this rather than my other half earning that money and being taxed, i really do do alot of paperwork though, i have to do myself a monthly payment statement like i do the other subcontractors, but thats it, my accountant says i do not need to do a tax return nor register as self employed. The tax office confirmed this. So now i have really confused you. Why dont you ring the tax office, i've always found them really helpful.

pool31

thanks missm29, no you haven't confused me, it is all helpful information.

I think your last bit of advice is probably the best, call the tax office, then we will have advice to go back to the health authority with.