AAah anyone kow what's the best thing to do..

gabyjane

Okay i work one job self employed and another employed. In the employed i work 12 hours a week and my yearly income with that is around £3400k, i have just done my self assesment and have been hammered a big £1200ish for that job, the self employed bit is about £600..so total £1800.
So my question is, am i better off doing less hours in the employed job? stopping the job completely, i don't know? all i know is iv'e kinda worked for about 3 months for nothing.
I obviously have earnt a chunk through my S/E job so is this why my tax is high? if anyone needs to know this i am quite happy to divulge as i want to get this sorted, have been onto the tax office and it's like banging my head against a wall!
Thanks for any replies.

CLAPTON

can you give more complete details

so what is your gross income and tax paid for each earning and your tax codes

gabyjane

CLAPTON wrote: »

can you give more complete details

so what is your gross income and tax paid for each earning and your tax codes

Thanks for the reply,

Ok £3479.00 from employed. Have had no tax taken from this every month as under the threshold every week.
£13,200 from self employed of this expenditure is around £2200.
online it says tax deducted the £5035 rate and then im confused with the rest!
my tax code from employed job is 503L...
Anything else?

CLAPTON

for the tax year 2006/7 based on your total earnings of 16,670 then your total tax should be about £2,300 assuming no other adjustments so it seems approximately correct.

your taxation on the SE income just looks high because you pay nothing on the employed earnings but overall its about right.

WHA

You're paying the same rate of tax on all income - I'm not sure where you get the idea that you're paying more tax on the employment. All your income is added together, your allowances taken off, leaving your tax bill - it isn't apportioned to one source of income or another - you could just as easily say that all the tax is because of your s/e and no tax is due on your employment.

gabyjane

WHA wrote: »

You're paying the same rate of tax on all income - I'm not sure where you get the idea that you're paying more tax on the employment. All your income is added together, your allowances taken off, leaving your tax bill - it isn't apportioned to one source of income or another - you could just as easily say that all the tax is because of your s/e and no tax is due on your employment.

Hmm i hate to disagree but you are wrong with the different rates thing. Last year i payed 10% on my self employed job and 22% on my employed, this is due to me having 2 jobs, this should apply to everyone with 2 jobs shouldn't it? if not there is something wrong.
Thanks for the other replys i also wanted to know if it's worth me dropping my hours in my empolyed job? is there a way to work out if ide be better off? thanks.

Pennywise

gabyjane wrote: »

Hmm i hate to disagree but you are wrong with the different rates thing. Last year i payed 10% on my self employed job and 22% on my employed, this is due to me having 2 jobs, this should apply to everyone with 2 jobs shouldn't it? if not there is something wrong.
Thanks for the other replys i also wanted to know if it's worth me dropping my hours in my empolyed job? is there a way to work out if ide be better off? thanks.

Out of interest, where are you getting the figures from that say what tax you are paying on each type of income? Under self assessment, all income goes into a big pot, and then tax is worked out on the total.

CLAPTON

gabyjane

it may appear that you are taxed higher on one source of income than another.. that's because the HMRC applies your Tax allowance to one so it looks as if your are paying less tax... but in the end the overall tax will be the same..

so if you stopped one source of income, the tax would re-appear on the other so you would have a double hit...loss of an income source and higher tax on the remaining.

as i said your overall tax is an bout right.

gabyjane

Pennywise wrote: »

Out of interest, where are you getting the figures from that say what tax you are paying on each type of income? Under self assessment, all income goes into a big pot, and then tax is worked out on the total.

Hi when i did my return online it came up with the 2 jobs, one was 10% and the other 22% i didnt know which was which until i rang them which is when i realised ide payed over £1k on my part time job which is why it made me wonder wether it was worth working there any more!!
If it's the case of it all balancing out then it's fine, but why don't they just add it all together to save confusing people!
Thanks for the reply.

nealnomoney

Oh my god gaby jane i cant believe you are arguing with WHA ( a practising accountant) wise up and listen to him he knows best.

harryhound

Hi Experts,

I am in a similar position, somewhat confused and I think a factor has been left out.

Assuming Jane isn't over retirement age; what about NI contributions?
These are not "insurance" in the normal meaning of the word, they are just more tax. In my case they are particularly useless as I've already got enough "stamps" to qualify for a state retirement pension.

Is there a point in the balance between employment and self employment where NI kicks in or out, creating a "why did I bother" effect.

Regards,

Harry.