Setting up self employment tax

freelancepuddle

Dazed_and_confused wrote: »

freelancepuddle

Your example includes tax due for two years not one (all tax for 2017:18 and payments on account for 2018:19) and in any case your figures show just under £4400 to pay, where on earth are you getting £7000 from ��

Figures clearly not a strong point so you might save yourself a lot of confusion (and possibly tax) by using an accountant??

NIC is no longer paid weekly for the self employed, this stopped a couple of years ago.

Because I was told above that you pay 2-3 times a year for self assessment tax as stated below.
Where are you getting £4400 from? I'm pretty sure the retainer they are issuing me with is only for a couple of months, so I'm not sure how I would pay that to HMRC. Figures definitely aren't my strong point - hence not getting a job in that field, but it seems like it's going to be the anchor that holds me back from accepting this role.

Amount owed to HMRC: £2,185.24. Payment on account for 2018/19: £1,092.62.
Total Self Assessment due by 31st January 2019: £3,277.86.
A further payment on account due by 31st July 2019: £1,092.62.

Dazed_and_confused

£3277.86 + £1092.62 = £4370.48

You could have further tax to pay on the actual 2018:19 profits but equally could be due a refund of some (or all) of the payments on account you have made for 2018:19, which way it would go would depend on how well your business does that year

freelancepuddle

Dazed_and_confused wrote: »

£3277.86 + £1092.62 = £4370.48

You could have further tax to pay on the actual 2018:19 profits but equally could be due a refund of some (or all) of the payments on account you have made for 2018:19, which way it would go would depend on how well your business does that year

Ah okay I'm not sure why it repeated it twice, I put it in a calculator for the following tax year and those were the results. Although this is a retainer which I have no idea will be permanent, so if I did go through the pain of applying to be self employed how would I pay them for a couple of months salary? How do I let HMRC know I'm no longer self employed (I've tried phoning them for advice but sat on hold for 40 minutes so I gave up).

Dazed_and_confused

It isn't salary, you have your own business, isn't that what the rest of this thread has established!

If you start self employment before 6 April 2017 you need to notify HMRC by October (I think, check gov.uk) and have to fill in a tax return by January 2018 and pay any tax due for 2016:17 then as well.

The example you gave would-be the return for 2017:18 which needs to be sent by January 2019 (and tax paid at the same time).

If your business ends you have to show this on the return (there will be date business ceased box to fill in, if you don't do this the HMRC will assume your business is continuing even if you have phoned them separately)

agrinnall

freelancepuddle wrote: »

How do I let HMRC know I'm no longer self employed (I've tried phoning them for advice but sat on hold for 40 minutes so I gave up).

The first result of a quick search:

https://www.gov.uk/stop-being-self-employed

freelancepuddle

Dazed_and_confused wrote: »

It isn't salary, you have your own business, isn't that what the rest of this thread has established!

If you start self employment before 6 April 2017 you need to notify HMRC by October (I think, check gov.uk) and have to fill in a tax return by January 2018 and pay any tax due for 2016:17 then as well.

The example you gave would-be the return for 2017:18 which needs to be sent by January 2019 (and tax paid at the same time).

If your business ends you have to show this on the return (there will be date business ceased box to fill in, if you don't do this the HMRC will assume your business is continuing even if you have phoned them separately)

I don't have my own business. I have always worked for companies as an employee and they have sorted out my tax. The only difference with this one is that it will be working remotely but they are giving me the role as a 'freelance on retainer' which I wasn't aware of, hence this thread.

Dazed_and_confused

Get an accountant

freelancepuddle

I just realized why I'm facing this issue - I was told I was working directly with a company which I'm not. It's being dealt with via an Umbrella company/agency, hence the retainer contract. I looked into it - and the agency should absolutely be deducting my NI contributions and tax just as a regular employer would and they're essentially dodging this despite it being the law that Umbrella companies must deal with PAYE.

booksurr

freelancepuddle wrote: »

I just realized why I'm facing this issue - I was told I was working directly with a company which I'm not. It's being dealt with via an Umbrella company/agency, hence the retainer contract. I looked into it - and the agency should absolutely be deducting my NI contributions and tax just as a regular employer would and they're essentially dodging this despite it being the law that Umbrella companies must deal with PAYE.

as it appears you neither understand the position you would be in nor are you being given straight answers by "the company" (not sure who that is though - the client or the umbrella!!!) your best solution would appear to be not bother with this "opportunity" and go get a regular job as an employee somewhere else

freelancepuddle

booksurr wrote: »

as it appears you neither understand the position you would be in nor are you being given straight answers by "the company" (not sure who that is though - the client or the umbrella!!!) your best solution would appear to be not bother with this "opportunity" and go get a regular job as an employee somewhere else

They've been deliberately vague and I now know why. I've slapped them with the evidence so it'll be interesting to see their response, but overall I've lost interest in working for them due to this.