Please Help!! Tax question, hours being reduced, turning 21!

Wolfie22

Hello, this is my first time posting on the forums but I've been reading them for a while.
I'm hoping someone can help me as this community is so great at supporting each other!

I currently work for a self employed small business owner in a grooming salon. They took me on full time (30 hours (minimum wage £5.13 ph) at the beginning of January. Due to the nature of the business, there were times when there wasn't enough work and I wasn't paid for days or weeks. The time has come in the year again when business is becoming quiet. They broke the news to me a few weeks ago that I should look for another job as they couldn't afford to keep me on. (I've been job hunting since) I still work there but in the next week or so my hours will be drastically reduced.

My problem and worry is (apart from being broke) that I turn 21 in October and that means my minimum wage goes up and I will be taxed on that as if I'm still working 30 hours and earning more.

My boss is reluctant in helping me or finding out information (don't get me started!) So I've been trying to research it myself, but cannot get any clear answers.

Do I call the CAB to find out info?
Do I call HMRC directly myself? (What do I say?!)
Is it even my responsibility to do so?

Also how does my employer get a P45 form to give me?

Sorry for all of the questions but I've terribly stressed about this and I don't have anyone to turn to! Thank you very much

[Deleted User]

If you are made redundant my understanding is that your employer should send your P45 to your home address or whichever they have on file for you.

HMRC should deal with your files directly corresponding with your employer, but it wouldnt hurt to call them a week after your job finishes to confirm information, as I dont believe they can deal with the information until everything is tied up your end.

I wouldnt worry about what to say to them, just tell them the truth and be brief about it. They're normally pretty understanding and if you get a difficult person on the other end just hang up and ring back another time.

If you're working 30 hours+ in your new job you can try to apply for Tax Credits/Universal credits. Your payment will depend on your working and home situation.

https://www.citizensadvice.org.uk/benefits/in-work-or-looking-for-work/benefits-and-tax-credits-for-people-in-work/#h-who-can-get-working-tax-credit

Also if youre made redundant you dont have to be broke, just apply for Jobseekers Allowance for a short while until you get back on your feet.

Hope this helps.

tomtontom

You're only taxed on what you earn. If you are not working 30 hours, you will not be taxed on that.

Your employer's accountant will be able to sort the P45.

You'll only qualify for tax credits if you have children or have a disability.

Wolfie22

Thanks Deleted_User, my current boss said I'd probably only be working either 8 - 14 hours a week, so I don't think/know if that would be classified as being made redundant would it?

Do I call HMCR to declare my hours are being cut to 8-14 hours (not sure yet) or does my employer have to do it? I understand what you said above, but I'm just confused as to what to do if I'm being kept on but my hours reduced.

Thanks again

tomtontom

Are you claiming tax credits? If not then you don't need to contact HMRC.

You may be eligible for a small amount of JSA (or Universal Credits), but keep in mind you'll need to fulfil a job seeking agreement to receive payment.

You're not being made redundant - that would only apply if you stopped working there altogether.

Wolfie22

I do not claim tax credits or any kind of benefits.

What I'm worried about is that my employer pays me cash in hand. This is documented and I assume it's put through his accountant. I keep my own records of my earnings and log them into a excel spreadsheet, but my employer doesn't give me a payslip/receipt of any kind. So I'm wondering if HMRC will automatically know? I'm really clueless about this, sorry. Also will he be taxed or do I get sent a bill of some sort, since I don't get paid through the bank?

I do not want to claim JSA, I understand I can but really don't want to resort to that.

[Deleted User]

I must have read it too quickly your first post OP, apologies.

If your hours are being reduced then no of course you're not being made redundant.

If you're being paid cash, you would have to clarify this with your employer about taxes to avoid tax being paid twice. I would phone HMRC regardless to check their records are up to date and check you have an allocated tax code.

If you are working less than 16 hours pw you are more than entitled to claim JSA on top of your working wage.

Wolfie22

Thank you everyone, that has cleared up any doubts of mine. I've asked my boss to talk to his accountant and see what's happening,I'm hoping that he does it sooner rather than later!

General_Grant

You are entitled to (in fact should actually receive) an itemised payslip each time you are paid by your employer.

Does your employer, employ anyone else? Do they actually have someone who oversees their payroll? (If they do, they will be able to get hold of P45 forms.)

Have you worked anywhere else in the last three years and paid NI contributions? (To receive JSA you need either to have paid NI contributions for a couple of years prior to the claim (contribution based JSA) or meet income/capital requirements (income based JSA)).

You probably have not been earning enough to pay income tax but, if you have, it is your employer's responsibility to deduct it and any money you have received will be deemed by HMRC as having been paid after tax had been deducted. (So you would not be required to pay any back tax - it would be your employer who would be required to pay it to HMRC if they had not in fact deducted any tax due.)