going self employed whats the deal

blondie81_2

i am thinking about going self employed but know nothing about it someone has said national insurance is cheap and you get 3 months free please help i don't know where to go or what to do the tax office is rubbish asked and got no further than the reception

cyrus_2

Hi,

You need to pay Class 2 NI contributions. The rate is currently £2.10 per week. If you make less than £4,465 per year you can apply and get a Small Earnings Exception (SME) certificate, which means you don't have to pay NI contributions for the time the certificate is valid.

You also might have to pay Class 4 NI contribution, but I don't remember the conditions right now.

For more info please refer to: http://www.hmrc.gov.uk/faqs/nicqse.htm

and http://www.businesslink.gov.uk/bdotg/action/layer?topicId=1073867963

Hope this helps

Conor_3

blondie81 wrote: »

i am thinking about going self employed but know nothing about it someone has said national insurance is cheap and you get 3 months free please help i don't know where to go or what to do the tax office is rubbish asked and got no further than the reception

You pay MORE NI overall.

There's a weekly amount, Class 2, which you're billed for quarterly, and there's Class 4 which you pay if you exceed £5000 net income per year at 8%. There's no 3 month free period.

Also, if you earn enough to pay tax in the first year, your tax bill for that year will be what's due plus 50% and then another 50% in July. So if your tax was £1000, you'd have to pay £1500 by the following January then another £500 the July after that.

You need to keep accounts and you need to keep those for 6 years.

Read up here:

http://www.hmrc.gov.uk/startingup/index.htm

LittleVoice

The "3 months free" you mention in first post is probably a misunderstanding that HMRC allow what I would call a "period of grace" of up to 3 months from your starting your business during which you should register as self-employed. It does not mean that you don't pay NI or tax for that period.

Here is the self-employment online registration form:
https://www.workingforyourself.co.uk/selfemployed/form.asp