Second job self employed.... tax wise where do i stand?

amberglover

I am a full time teacher currently earning approx £22000. I have a personal allowance of £10,600 and pay the usual 20% tax on anything I earn above that.

I am just starting to privately tutor outside of work. I am charging £25 an hour and am expecting to make approximately £4500 in addition to my original salary.

I know that once this tax year is up I will need to fill in a self assessment with me having a second job that is self employed. However I am trying to gauge how much tax I will be paying so I know how much of the £25 an hour I can bank as my own if you like. I'm a bit clueless on all of this so I apologise if I come across a bit stupid, I've just never had to file a self assessment before and I'd rather keep on top of my finances throughout than be stung with a tax bill at the end of it. I don't want to have to pay for an accountant as I'm clued up enough once I've been signposted in the right direction to keep track myself for now.

Will I still pay 20% on the additional earnings or will I go up a tax band because of it being a second job?
Also will I need to pay national insurance? From what I've googled I don't think I will but if anyone can confirm that, it would be great.

Thanks in advance for any resonses. If there's anything else you think I need to know then please pop it down .

Amber

Darksparkle

amberglover wrote: »

I am a full time teacher currently earning approx £22000. I have a personal allowance of £10,600 and pay the usual 20% tax on anything I earn above that.

I am just starting to privately tutor outside of work. I am charging £25 an hour and am expecting to make approximately £4500 in addition to my original salary.

I know that once this tax year is up I will need to fill in a self assessment with me having a second job that is self employed. However I am trying to gauge how much tax I will be paying so I know how much of the £25 an hour I can bank as my own if you like. I'm a bit clueless on all of this so I apologise if I come across a bit stupid, I've just never had to file a self assessment before and I'd rather keep on top of my finances throughout than be stung with a tax bill at the end of it. I don't want to have to pay for an accountant as I'm clued up enough once I've been signposted in the right direction to keep track myself for now.

Will I still pay 20% on the additional earnings or will I go up a tax band because of it being a second job?
Also will I need to pay national insurance? From what I've googled I don't think I will but if anyone can confirm that, it would be great.

Thanks in advance for any resonses. If there's anything else you think I need to know then please pop it down .

Amber

Tax rates are here - https://www.gov.uk/income-tax-rates/current-rates-and-allowances

From what you have said, you will remain a basic rate tax payer so will be taxed at 20% on your self employed profit.

Self employed NI rates are here - https://www.gov.uk/self-employed-national-insurance-rates

Again from what you have said, there would be no NIC to pay on the self employed income.

If you are repaying student loan you'll need to factor that in.

amberglover

Thank you!
Hadn't even thought about student loan so thanks for pointing that out.

amberglover

Do I need to inform HMRC about the second job now? Or do I literally just do it through self assessment when that is due?

Darksparkle

amberglover wrote: »

Do I need to inform HMRC about the second job now? Or do I literally just do it through self assessment when that is due?

If you start in this tax year, so before 5th April 2016, you need to register before 5th October 2016. Deadline for SA online would be 31st Jan 2017.

Link to gov - https://www.gov.uk/set-up-sole-trader/register

However no point in prolonging it, just register as soon as you start and no need to wait until the last minute to do your return.