Paying tax on the side job without changes to the tax code

Cpu2007

I have about paying tax but not having any changes made to the tax code so that it doesn't show like I have two jobs.

I work full time but I do also have a second job (self-employed if I might call it like this) where I sell electronics; now this is a very irregular job, I just do it when I feel like it and there's no consistency. However I do make enough money out of it and would like to pay tax on it.

Is it possible to pay tax on it but without having to declare a second job?

Thank you

agrinnall

Whether you call it self-employed is largely irrelevant, the circumstances are what dictate your employment status. These are the options:

https://www.gov.uk/employment-status/overview

Is your selling done for someone else, or do you do it for yourself? If the latter then you probably are self employed, in which case you'd have to be in Self Assessment and pay tax on your profits, but you could be outside PAYE so there would be no change to your tax code - sole trader may be an option for you.

https://www.gov.uk/business-legal-structures/sole-trader

Cpu2007

I do it myself.
What exactly does that mean "you could be outside PAYE"

Does that mean that my tax code will stay the same ?
Does this mean that I will have to pay tax on my selling?

The idea is not two have P45/P60 giving me two different jobs and therefore two different annual earnings and two different tax deductions as well as having a tax code changed.

How can I achieve that through self-employment?

Savvy_Sue

If you're self-employed, your tax code does not change, you register with HMRC as self-employed and declare your profit via self-assessment and pay tax on that. So I hope you've been putting some of your profits aside for that.

How long has this additional income been going on?

Cpu2007

On and off for months but after April, wasn't expecting much profit but then I realised that I am making some profit. This was a side job so it was pretty much to boos my income, I have tax to pay them.

Do I have to tell my current employer about the self employed job?
Do I have to pay NI as well?
Do I have to provide the self assessment now or for April 2017?
Thanks

agrinnall

1) Depends on what your contract says about work outside of your primary employment.
2) Yes, but different NI to what you pay as an employee.
3) If all the work has been from April 2016 then your first SA will be for the 2016-7 tax year. Probably due end of January 2018, although I'm not well up on the self employed requirements.

If you read the links I gave and follow links from those pages you'll be more aware of what you need to do.

polymaff

Savvy_Sue wrote: »

If you're self-employed, your tax code does not change ...

I don't see how you can say this, Sue. Self-employed income in addition to a PAYE-based income is aggregated and a change in code is a common method used by HMRC to collect tax due on that aggregate sum

@CPU2007 - I don't know how much you're turning over, but this from the 2016 Budget may be of interest:

1.170 The rapid growth of the digital and sharing economy means it is becoming easier for more and more people to become ‘micro-entrepreneurs’. However, for those making only small amounts of income from trading or property, the current tax rules can seem daunting or complex. To help make the tax position more certain and simple for these individuals, from April 2017 the Budget introduces two new £1,000 allowances for property and trading income. Individuals with property income or trading income below the level of allowance will no longer need to declare or pay tax on that income. Those with relevant incomes above £1,000 can benefit by simply deducting the allowance instead of calculating their exact expenses.

CLAPTON

Cpu2007 wrote: »

On and off for months but after April, wasn't expecting much profit but then I realised that I am making some profit. This was a side job so it was pretty much to boos my income, I have tax to pay them.

Do I have to tell my current employer about the self employed job?
Do I have to pay NI as well?
Do I have to provide the self assessment now or for April 2017?
Thanks

if your second income was started after april 2016, then you will need to declare the earnings for the tax year april 2106 -2017 AFTER april 2017 and BEFORE the end of january 2018: so you have plenty of time

you should however advise HMRC that you are now self employed.

Savvy_Sue

agrinnall wrote: »

1) Depends on what your contract says about work outside of your primary employment.

Agreed: and NOT telling them if it's a requirement of your contract to do so is a big risk.

agrinnall wrote: »

2) Yes, but different NI to what you pay as an employee.

And maybe none if your profit is not very large?

polymaff wrote: »

I don't see how you can say this, Sue. Self-employed income in addition to a PAYE-based income is aggregated and a change in code is a common method used by HMRC to collect tax due on that aggregate sum

It can be, but I thought you could choose whether to do it that way or not? Obviously some people might prefer that, especially if their self-employed income is steady, but if income is going to fluctuate from year to year then it would mean a lot of changes. In that situation I'd prefer to keep control of it myself.

polymaff wrote: »

@CPU2007 - I don't know how much you're turning over, but this from the 2016 Budget may be of interest:

1.170 The rapid growth of the digital and sharing economy means it is becoming easier for more and more people to become ‘micro-entrepreneurs’. However, for those making only small amounts of income from trading or property, the current tax rules can seem daunting or complex. To help make the tax position more certain and simple for these individuals, from April 2017 the Budget introduces two new £1,000 allowances for property and trading income. Individuals with property income or trading income below the level of allowance will no longer need to declare or pay tax on that income. Those with relevant incomes above £1,000 can benefit by simply deducting the allowance instead of calculating their exact expenses.

Yes, these are useful changes for those with a small level of profit.

Cpu2007

Thank you for all the replies.

@polymaff, thank you for that info, I was aware of that and it's quite useful.

My employer doesn't need to know but I would rather not tell, it's a side job to make some extra money and I don't want employer to use that as an excuse to think that I giving less at my current place of work.

I am in the 20% tax with tax code 1100L, with this extra income I am still in the same band and I am hoping to keep the 1100L band.

I will be leaving my current employment soon and don't want to end up with tax complications with the next employer, where you have tax deduction for the previous employer separate, tax deductions for self-employment separate, NI separate, tax code changing.

I looked at the self employment page already but it didn't provide the info I am looking for unfortunately.

One thing to do would be, pay some tax to HMRC now and ask them for the P45 AND P60 to see how it looks after the tax from self employment has been injected?

CLAPTON

Cpu2007 wrote: »

Thank you for all the replies.

@polymaff, thank you for that info, I was aware of that and it's quite useful.

My employer doesn't need to know but I would rather not tell, it's a side job to make some extra money and I don't want employer to use that as an excuse to think that I giving less at my current place of work.

I am in the 20% tax with tax code 1100L, with this extra income I am still in the same band and I am hoping to keep the 1100L band.

I will be leaving my current employment soon and don't want to end up with tax complications with the next employer, where you have tax deduction for the previous employer separate, tax deductions for self-employment separate, NI separate, tax code changing.

I looked at the self employment page already but it didn't provide the info I am looking for unfortunately.

One thing to do would be, pay some tax to HMRC now and ask them for the P45 AND P60 to see how it looks after the tax from self employment has been injected?

P45 and P60 are produced by employers and have nothing at all to do with self employment.

if you started your self employed work after april 2016 then you will need to submit a tax return AFTER April 2017 and BEFORE end of jan 2018
You will need to pay any tax before the end of Jan 2018 : in general, you can pay the tax (and any NI) in one lump sum so your main job PAYE tax code will remain unchanged. Sometimes HMRC give the option of changing your PAYE taxcode to recover small amounts of tax.


In any event, even if your tax code changes there are dozens of reasons why your tax code can be non standard and your emplyer won't query why its changed.