Dreaded Tax

nomunnofun

cobbychops wrote: »

nomunnofun, thank you for your response.

I choose to work for one consultant As a medico-legal secretary undertaking private practice, I had the option of working for many consultants (as many of my NHS colleagues who also undertake private medico-legal work do), and that was my plan - a secretarial service. However, the work load for the one consultant alone means that I do not have the capacity in the week to work for more than one at present- this is also the same for some of my colleagues. Therefore my secretarial service is dedicated to one (at present).


Medico-legal secretaries like myself are paid per report/per clinic letter, not per hour. We do not work set hours/days. I set my own workload and choose what I do or do not undertake.

Before embarking upon this new post, I took the liberty of contacting HMRC to ascertain what would be required of me, and explained the set up and what I would be paid for and what I would be invoicing for and how my work would be undertaken. It was HMRC who advised me that I would need to register and complete a self assessment for tax purposes.

Likewise, when I was taken on by Dict8, a transcription company for medical secretaries, we were responsible for our own tax and national insurance contributions and all secretaries are employed on a self employed basis. We would invoice Dict8 for the work we undertook each month - this varied dependent upon how much work we managed to get through. This is the same for my current medico-legal employment.

With regards to the stationery (you were quite right to correct my spelling) - the consultant chooses to reimburse me for those consumable items (paper and envelopes - as they are ordered with his own logo printed upon them), although equally both I and he are happy for me to add a percentage to my monthly invoice to cover this.

Your comments are very interesting though, as it's something I hadn't really considered before.

Perhaps it may be worth going down the road of changing status to being employed by the consultant - although I am not sure how that would work as the volume of work varies and I am paid per report etc, which again varies due to his own timetable. Definitely food for thought, and thanks to everyone for their input, for which I am very grateful.

No problem, cobbychops (great name). Just remember that your consultant may not be so keen to pay you on an employed basis as he would have to pay employers NIC, an extra direct cost to him/her. This is usually the reason for HMRC attack on employment status.

Savvy_Sue

nomunnofun wrote: »

No problem, cobbychops (great name). Just remember that your consultant may not be so keen to pay you on an employed basis as he would have to pay employers NIC, an extra direct cost to him/her. This is usually the reason for HMRC attack on employment status.

He might not be paying employer's NI every month if the OP was earning less than the threshold, but he would have to pay for annual leave. On irregular hours, there are various ways of working that out.

cobbychops

Thank you all. This is such a great advice forum. It's a real minefield out there isn't it?

It's wonderful to have access to such a wealth of advice and experience. I love it!

medsec_222

Hi - I have just started doing medical typing at home. I have had three cheques so far. I am retired and don't pay national insurance. I was thinking of setting aside 20% of the money I receive each month for tax purposes. Does anyone know what I could claim to offset my tax bill.

zygurat789

medsec_222 wrote: »

Hi - I have just started doing medical typing at home. I have had three cheques so far. I am retired and don't pay national insurance. I was thinking of setting aside 20% of the money I receive each month for tax purposes. Does anyone know what I could claim to offset my tax bill.

Just because you are retired does not mean you don't pay NI, you have to be over the state pension retirement age.
You may claim against your tax bill any expense which is wholly and exclusively incurred in earning that income. In your case, anything to do with typing and a reasonable percentage of phone, internet etc. Accommodation costs are £4pw according to HMRC but this is presumeably for a full week say 35hrs.

Savvy_Sue

zygurat789 wrote: »

Just because you are retired does not mean you don't pay NI, you have to be over the state pension retirement age.

Although if your profit from self employment is likely to be less than c.£6000 pa you can get a small earnings exemption certificate, so that's another possible reason for not paying NI.

zygurat789

Savvy_Sue wrote: »

Although if your profit from self employment is likely to be less than c.£6000 pa you can get a small earnings exemption certificate, so that's another possible reason for not paying NI.

The current exception limit for 2013/14 is £5,725.

Hadenoff

Hi all, I know this is an old thread, but I just wanted to ask those of you who work for Dict8 - are you still paid at a rate of 8 pence per line? I have been paid at this rate for years, a rise would be nice wouldn't it!

TheCyclingProgrammer

cobbychops wrote: »

Your comments are very interesting though, as it's something I hadn't really considered before.

Perhaps it may be worth going down the road of changing status to being employed by the consultant - although I am not sure how that would work as the volume of work varies and I am paid per report etc, which again varies due to his own timetable. Definitely food for thought, and thanks to everyone for their input, for which I am very grateful.

Don't let nomunnofun's comment scare you; I think he's jumping to a lot of conclusions based on your post. I see his point but it sounds to me like your self-employed status is fine.

At the end of the day, if you're really in disguised employment, its not you that is going to get in trouble - you've been filing your returns as you should be and you haven't avoided any tax. It will be your "employer" who is in trouble as they have been avoiding employers NIC.

But its more than possible to be self-employed but only have one ongoing client; its your working practices that will count, particularly the level of direction and control your client has over you (presumably they don't tell you how to do your job and leave you to fulfil your tasks as and when you see fit).

Invoicing monthly is completely irrelevant too. Lots of consultants/freelancers/contractors invoice on a monthly basis.

TheCyclingProgrammer

medsec_222 wrote: »

Hi - I have just started doing medical typing at home. I have had three cheques so far. I am retired and don't pay national insurance. I was thinking of setting aside 20% of the money I receive each month for tax purposes. Does anyone know what I could claim to offset my tax bill.

20% is enough to cover the tax liability, assuming you don't earn over the higher rate threshold, but you'll need to set aside money to cover the NI too. Have you registered as self employed yet? You should do ASAP and if you'll also have to register to start paying Class 2 NIC contributions (or apply for a Small Earnings Exemption certificate if you don't earn enough).