Newly self employed

Jasminecuddle

Hi

I was newly self employed Nov 2010 and have registered so I presume there is not self assessment form to fill in yet as its the 2009-10 one isn't it due in Jan31st?

Also does anyone know how to claim tax back as I have been working for a company for a few months and shouldn't be paying tax as i have not earned anything before this.

thanks!

Jasminecuddle

nexus2011

Were you working for the company as self-employed and when were you working for them ?Also you would fill in a 2010-2011 tax return i.e. for the tax year April 2010-April 2011.

John_Pierpoint

It is possible to be employed for one source of income and self employed for another.
Self employment is regarded as a profit making business opportunity and taxed on its profits.
You can account to HMRC as having one or more self employed business.
Being employed puts you into a "servant & master" relationship.
Some employers have rules about what their "servants" (employees) are allowed to do when not on duty.
HMRC is happy to let you self assess as both - just watch out for the rules on National Insurance.
Your self employed business profits do not need to account with year end dates aligned with those of the HMRC fiscal year: 06April to 05th April (but it makes life simple if you do).
Be aware that the profits you make up to 05 April 2011 need not be reported and self assessed for tax until 31st January 2012 BUT at that date you will have to pay them plus more tax on account for the then 11/12 tax year - so don't spend your tax and National Insurance (Class 4 NI) liabilities.

no-oneknowsme

John_Pierpoint wrote: »

BUT at that date you will have to pay them plus more tax on account for the then 11/12 tax year - so don't spend your tax and National Insurance (Class 4 NI) liabilities.

OP- payments on account only come into play if your tax liability for the previous year was £1k.

So , if you paid less than £1k last tax year you will not have to make any payment on account when you file your first return.

Not every business makes enough profit to pay £1k tax and so not everyone is liable for payments on account.

John_Pierpoint

I notice that there is also a clause stating that you won't be charged payments on account if 80% of your liability has been discharged at source (ie PAYE, Savings Accounts, Dividends etc.)

If you have a small profit you can also apply for exemption from National Insurance weekly and yearly payments.

http://www.litrg.org.uk/low-income-workers/self-employed/self-assessment#payments