How much to put aside initially for NI/Tax?

Lizbetty

Hi everyone!

My husband set up as a fork lift truck instructor in May this year, and although it's picking up, it's been a shock to our bank account. Ahem...

As such, we haven't managed to put away the MSE recommended amount of 25% of the money we've earned to cover our tax/NI. Si pays his NI subs by direct debit, and as his tax starts at £5k plus, we're just left wondering how much extra NI we might need for what he's earnt so far, if any?

He's not earned £5k yet to date (we wish, lol!), so I understand that no tax is yet applicable.

Can anyone advise whether we should be putting some away before he reaches the amount to start paying tax, for NI purposes? Or give us a clue how much NI would be charged on how much, etc, or point us in the right direction to find out, please?

As we have two kids to support it'll be hard to save in these early days, and so I'm hoping we should be ok waiting til we reach £5k and going with the recommend 25% of earnings - but better to live on beans now I guess than have a hefty NI bill we weren't expecting...

Thanks lots in advance for any advice anyone can offer.

Luce

newlywed

Try https://www.listentotaxman.com. You put in your weekly or monthly money and it gives you a guide of how much tax and NI. Only a guide mind, but it's a start

Lizbetty

That's exactly what we needed, thanks loads Newlywed! :beer:

newlywed

You're welcome! It was posted on here a while back and since OH is self employed, I know what a nightmare it can be working out how much you may have to pay at the end of the tax year

welshgirlmel

There are a couple of links below that might be useful about national insurance, I think listen to taxman only works if you are employed by someone, NI contributions are a flat rate if you are self employed as you dont get all the benefits that you would if you are employed. I think this is £2.10 a week, have a look at the link below, also if you have profits of roughly £5000 to £33000 you pay 8% N.I. but i dont know all the ins and outs of it

This is a adobe acrobat file which you need to download but it is from the business eye website which is genuine
http://www.businesseye.org.uk/2316.html

http://www.hmrc.gov.uk/individuals/more-tmanational-insurance.shtml

regards Mel