Receiving a one off payment for some work..

Feanor

Hi

I wonder if someone could help me. My other half is a software developer and works full time for a company.

One of his friends has been offered a contract of a small project for which they would each receive around £3,000. If this goes ahead and he receives this money, can someone please advise what he has to do about tax, national insurance etc. How does he make sure its all legit?

Thanks

Savvy_Sue

They tell HMRC that they will need to do a tax return at the end of the year, because they're doing a one-off piece of work. And they put 1/4 of the money aside for tax. If it's just a one-off I don't think they have to register as self-employed, but HMRC are the final authority on this, and if they do have to register as s/e but won't earn much that way then they ask for a Small Earnings Exemption from paying NIC.

Kilty_2

He might want to check his contract of employment - some prohibit you from doing work of the same nature for anyone else whilst you're an employee.

Feanor

Thanks..I think we'll check with the HMRC to be sure.

Yes he has alreayd cleared it with his current employer.

Thanks again