Consultant or Employee

mattrobbo99

Hi sorry I've another question. I'm not very intelligent when it comes to taxation issues.

The amount I would earn at the second job would be around 20k. So couldn't I just pay the tax at the end of the financial year as if I was self employed? What is the deferment? My wife has a second job and just declares it during the following tax year and it's an easy process. She just files it online and pays her tax.
She earns about 5k. Is the issue that my second salary would be higher?
Would it be possible to reply as if you were talking to a novice in this field :-)
Thanks

nomunnofun

Deferment - one only has to pay a certain maximum of NIC's at 12%. After that it is at 2%. (See post 7) If you did not claim deferment, regardless of what you earned at the first job, the second job would have NIC at 12% applied. You apply for deferment to have this reduced to 2%.

The amount you earn would make a difference. Let's say that you start self-employment on 6th April 2013 and make £20000 profits in first year and £22000 in second. The tax and NIC due in 2013/14 would be (after deferment) £8400 (£20000 x 42%)

Tax due 2013/14 - £8400 payable 31/01/15

So you start self-employment in April 2103 and pay nothing until January 2015!!!!

Tax due 2014/15 ( £9240)

Payable 31/01/15 (SAME DATE AS ABOVE) £4200
31/07/15 £4200
31/01/16 £840

and so on!