Fleeting self-employment and tax

Cottage_Economy

I was made redundant from my job on Friday.

Prior to employment three years ago I was self-employed, but carried on doing a bit of freelance work here and there sporadically when I became employed and simply paid the 20% tax etc through self-assessment. I remember filling in the form to tell the tax office that my employed job would be my main job.

Right now I'm doing some freelance stuff while looking for a new job.

However, I'm not sure whether I should be letting the tax office know that this is now my main source of income for at least the next month? I'm literally only doing it until a job comes along, which could be at any time as I'm actively job hunting.

What's the best way of sorting out something this temporary?

I should add I have a redundancy package which I am living off and I'm not sure would count as income in this respect? Some of it was the last month's salary with a bit of PILON and that has been taxed. The rest was a redundancy pay out which hasn't.

Prothet_of_Doom

You need to let the tax office know that you are working freelance self employed. They will tell you how much NI you have to pay now, and when you need to do a self assement - for this tax year upto April 2014, you have to submit by end Jan 2015, so put 40% into a high interest account til then.

dzug1

What would be wrong - if it's short term - in not telling them and then declaring it as casual earnings in your self assessment tax return?

tyllwyd

So have you been filling in a self-assessment form every year to cover the bits of self-employed work that you've been doing? So you are already registered as self-employed? If so, I don't see why you can't just continue as you are and just declare your profits on your next self-assessment form as usual. You might need to check that you are paying your class 2 NI, which is about £12 a month.

Delphina

My view is the same as that of Tyllwyd...

If you are still required to do SA returns, there is no need to tell HMRC as long as you declare the income. But you may need to inform the NI office if you have already told them that your self emp had ceased.

Failure to notify:
- re NIC 2 you may be fined,
- re SA, in the worst case sanario, you may get into trouble with tax investigation which could cover multiple years.