Self employment and csa

justontime

When you say that you are going self employed do you mean that you will be a sole trader, setting up your own limited company, working as a contractor through an umbrella company or some other company structure?
I'm checking because people tend to use the term self employed very losely to cover a lot of different options. If we know what type of arrangement you have in mind it will be easier to give an accurate answer to your question.

pugger

I will be a sole trader.

jacklink

oh and p.s. you can request a reduction in payments for travel to see kids as she was the one who moved so far away (i believe)

pugger

Thanks for your input. Yes I've not long realised that! I should say also that I'm not trying to avoid paying for my child; I just want to know how it works so I don't end up in arrears or with a big bill.

justontime

pugger wrote: »

I will be a sole trader.

I don't have any experience of CSA arrangements for sole traders, my husband set up his own ltd company eighteen months ago so I know more about how CSA deals with that. I hope someone else can help you.

You have probably already done this, but it would wise to get some advice about the best option for you in terms of ltd company or sole trader before setting up the company.

I hope all goes well for you.

pugger

Thanks. Having had a dig around the internet i've seen talk of them assessing your earnings after 3 months of trading then I guess they will do it again at the start of the new tax year. Could really do with some help though on whether pre tax expenditure is included as that would really falsely inflate the figures.

justontime

When my husband started his ltd company he notified CSA straight away. They told him to continue paying at his old rate then they would would reassess him after 3 months. Our whole aim was to keep the CSA payment at the same level as before (there was no intention to decrease it or pay less). My husband had made provision for CSA payments as well as start up costs for the business so despite the lack of income in the early months he was able to pay at the old amount.

They contacted him for a reassessment after 3 months (I think it was nearer 4 months). He provided the info they needed and he wrote to them stating that the company was due several big payments and he would be able to pay himself back pay as soon as that happened. He begged them to wait a couple of months longer before doing a reassessment, but they did the assessment anyway which resulted in a zero assessment.

The next thing was that they phoned to say they were going to close the case (which didn't make sense). My husband tried to reason with them but could get no meaningful response. He heard nothing more and there was no written notification that the case was closed so he then had to pester them for another reassessment. Nothing happened at all until my husband asked his MP to raise the matter with them. Then he got an assessment but he had to query it because they hadn't included his dividends (he is on CSA 1 so they should have been included without the need for a departure/variation). Eventually he got an accurate assessment but they have made no attempt to assess him again since and we haven't dared to ask for one in case it gets all messed up again.

If this is the experience of someone who actively wants to pay, I can imagine that people who don't feel the same sense of urgency about paying a fair amount could manage to avoid payment for quite some time.

Crellow4

There is always the option to NOT report the change of employments status - it is not a legal requirement. That way, payments stay the same and everyone is happy.

pugger

The payments are taken direct from my employer so I can't really do that.

pd001

Crellow4 wrote: »

There is always the option to NOT report the change of employments status - it is not a legal requirement. That way, payments stay the same and everyone is happy.

Is that correct?
The NRP has the option NOT to report a change of their circumstances?