First payslip - no tax?

ashh1992

LittleVoice wrote: »

When you say "freelance", do you mean self-employed where you invoice your clients?


How long have you been doing this? Did you notify HMRC?

Yes, registered as self employed and invoicing clients (it was just one client at a rate of £500 a month) from June 2014-August 2015 before full-time employment. And, to my knowledge, as I started after April, I'm not due to do my tax return until next year I believe?

Does that impact anything to your knowledge? In terms of whether or not I should have selected option A or B on the P46?

chrisbur

ashh1992 wrote: »

Thanks for your help, Chris! So, to confirm, I will continue to not pay tax until the £10,000 threshold is reached and then will pay tax as normal?

Also, was it right for me to have selected Option A on the P46? As I was freelancing before (I wasn't sure if that was considered having a job within the period noted).

You will start to pay tax when your total earnings to date exceed your tax allowance to date, so eg say in month 10 your tax allowance was £8833.33 (10/12 of £10600) and your gross to date was £8733.33 you would pay tax on £100. You would then have caught up with your tax allowance so for the next two months you would then pay tax on anything you earned over £883.33. This example is to warn you that you may get a month when you start paying tax that is lower than normal as you have just crept into the tax paying position do not assume that this first month of tax will be your normal tax every month.

No problems with option A but you must remember that there will be 20% tax on all your self employed earnings, and do not forget to fill in the employment pages on the self assessment.

p00hsticks

ashh1992 wrote: »

Yes, registered as self employed and invoicing clients (it was just one client at a rate of £500 a month) from June 2014-August 2015 before full-time employment. And, to my knowledge, as I started after April, I'm not due to do my tax return until next year I believe?

The self assessment deadline for Tax year 2014-15 is 31st January 2016 - but there's nothing to stop you doing one now, as the tax year finished in April (I never understood why everyone leaves it to the last minute and then panics when the system crashes or they realise they have left it too late to register for the online service or have forgotten their password).

That will cover the freelancing period from June 2014 to 5th April 2015.

you'll then need to do another SA the follwing year to include both your freelancing from 6th April 2015 and your PAYE employment.