National Insurance Contributions class 2 SEE for next year

tebow

I am employed and self employed. In 21-13 I knew I would earn <5995 in self employment and so applied for and received the SEE certificate. For 13-14 I am genuinely not sure how much I will earn.

Can anyone advise what they might do - do I ask not to have this exception, if so what do I need to save or pay in NIC2, or do I wait to see if I might go over and then tell them to retract the certificate.

I also heard about deferment when you are employed and self employed if you are over the SEE limit. Does this mean they calculate it at the end of the financial year and see how much I owe if any?

Any words of advice gratefully received.

Davide123

You can get a deferment for class 2 if you earn a lot as an employee. (Paying max NI through the employment.) if you want you could try and do the annual maxima calculation, but you will probably be doing that comp for days.

I would just carry on with the SEE....

nomunnofun

Davide123 wrote: »

You can get a deferment for class 2 if you earn a lot as an employee. (Paying max NI through the employment.) if you want you could try and do the annual maxima calculation, but you will probably be doing that comp for days.

I would just carry on with the SEE....

I have to agree - the op could always claim a refund at the end of the year.

The calculation of NIC overpayment when one pays Class1, 2 and 4 is, and always has been, one of the most complicated calculations in the system. It became even more complicated when a maximum Class 4 contribution no longer existed with the introduction of the 1%, now 2%, rate.

tebow

i earn 30k in my employed job and pay the usual tax/NI/student loan etc on that.

so if i carry on with the SEE then go over and let them know, will I owe lots/get in trouble.

what does deferment mean practically in this situation?

thanks for your help

nomunnofun

tebow wrote: »

i earn 30k in my employed job and pay the usual tax/NI/student loan etc on that.

so if i carry on with the SEE then go over and let them know, will I owe lots/get in trouble.

what does deferment mean practically in this situation?

thanks for your help

Kind of irrelevant in your case unfortunately as you would have to be able to say that you will pay the maximum NIC up to the accrual point of £770 per week - you can't. If you have reasonable knowledge that your earnings from self-employment will exceed 5775 you really should be paying Class2. Given your salary I would be reasonably certain that the total Class 1 and Class 2 payable by you will not exceed the maximum payable. If you are curious as to the complexities, have a read of this article which touches the surface, particularly the calculation.

http://www.brighton-accountants.com/blog/national-insurance-class-4-restriction/

tebow

Thanks for your reply. Thanksfully I don't work in the field of figures as this all goes over my head.

It's difficult as I get paid in self emp per piece of work that I do in some respects. and I anticipate earning about 5.5k in 13-14. but if one or two pieces take a bit less then I could complete an extra one/two that could take me to say 7-8k, over the SEE limit.

Just so I know the impact, how much/% is class 2 NI? and if i went over the 6k-ish limit, do i pay this on all of the self-emp earnings or just the earnings above it?

thanks again!

nomunnofun

tebow wrote: »

Thanks for your reply. Thanksfully I don't work in the field of figures as this all goes over my head.

It's difficult as I get paid in self emp per piece of work that I do in some respects. and I anticipate earning about 5.5k in 13-14. but if one or two pieces take a bit less then I could complete an extra one/two that could take me to say 7-8k, over the SEE limit.

Just so I know the impact, how much/% is class 2 NI? and if i went over the 6k-ish limit, do i pay this on all of the self-emp earnings or just the earnings above it?

thanks again!

You are a tad confused on the different types of NIC. Class 2 is paid at a flat rate of £2.70 per week if you expect to make profits in excess of £5725. These should be paid by direct debit, usually quarterly.

http://www.hmrc.gov.uk/payinghmrc/class2nics.htm