Self Employed Earnings?

SomewhereOverTheRainbow

Hi

Been reading and reading and reading...............

I am sure I have missed this but how does one work out salary for self employed person?

My husband is SE, and as I am sure you can all relate to, hasn't taken a set amount out of his business monthly but rather has paid the suppliers he needs to keep going and given what was left to pay bills.

Do I look at last years drawings and divide by 12?

He is liable for tax now (first payment due in Jan 13, as per accountant last week). So I need to have saved £4.5k by then - I assume I deduct that from drawings.

Plus he has some business debts - not formal arrangements but on-going pay offs to old suppliers, we have been paying these off monthly and intend to keep doing so - don't want them included in IVA/Br - will that be ok as they are really business expense and not our personal creditors.............95% of our debt is personal - cc - o/d

Thanking you in anticipation

immoral_angeluk

Is the company limited? Or is he a sole trader?

antonic

If he is paying via Self Assessment the date will be Jan 31st with next instalment due on 31 July.

SomewhereOverTheRainbow wrote: »

Hi

Been reading and reading and reading...............

I am sure I have missed this but how does one work out salary for self employed person?

My husband is SE, and as I am sure you can all relate to, hasn't taken a set amount out of his business monthly but rather has paid the suppliers he needs to keep going and given what was left to pay bills.

Do I look at last years drawings and divide by 12?

He is liable for tax now (first payment due in Jan 13, as per accountant last week). So I need to have saved £4.5k by then - I assume I deduct that from drawings.

Plus he has some business debts - not formal arrangements but on-going pay offs to old suppliers, we have been paying these off monthly and intend to keep doing so - don't want them included in IVA/Br - will that be ok as they are really business expense and not our personal creditors.............95% of our debt is personal - cc - o/d

Thanking you in anticipation

SomewhereOverTheRainbow

Immoral angeluk - He is a sole trader

Antonic - sorry I meant 31 Jan 13

antonic

I thought that was what you meant !;)

SomewhereOverTheRainbow wrote: »

Immoral angeluk - He is a sole trader

Antonic - sorry I meant 31 Jan 13

SomewhereOverTheRainbow

LOL yes it was - and of course because it is first tax payment - tax owing + 50%!

SunshineBear

They base it on 'Profit' for the year and not drawings. Have your accountant draw up his figures and present the last full years accounts (April 2010-March 2011) as a basis for your IVA. Then when you have 2011-12 figures let them have these as well. Your ongoing expenses and tax bill are of no interest to the IVA just your actual acounts figures.

sundays

Remember for IVa purposes even child benefit and tax credits are taken for payments towards the creditor.
A very unpopular rule that happened earlier this year but leaves a lot with very little.