Pay slips and self assesment tax returns

Pascal666

I am currently employed full time and payed by paye.
I pay about £400 a month into a work based pension.
I also work self employed and do a tax return.
If i apply to remortgage i can submit 3 months payslips and they use "total earnings in this employment" as proof of income before the pension contributions are deducted.
If i want my self employed income to be considered aswell for mortgage purposes do i have to use a p60?
The problem with this is that a p60 will show total combined earnings after pension contributions have been deducted, effectively meaning the first £400 a month i earn self employed will not be of any benefit in the amount i can borrow.
Is there anyway around this?
Many thanks

ACG

Most lenders will use gross annual income before any deductions (pension/tax/sharesave etc). The only deduction that is usually included is childcare vouchers.

If you want to use your self employed income, you will need your tax overviews from HMRC.

Pascal666

But tax overview only shows taxable earnings the same as a p60 does

csgohan4

your tax return overview will include both employed and self employed data and will be used for the remortgage, this is different to a p60 which is only for your employed portion of work

Game_Over

Pascal666 wrote: »

I am currently employed full time and payed by paye.
I pay about £400 a month into a work based pension.
I also work self employed and do a tax return.
If i apply to remortgage i can submit 3 months payslips and they use "total earnings in this employment" as proof of income before the pension contributions are deducted.
If i want my self employed income to be considered aswell for mortgage purposes do i have to use a p60?
The problem with this is that a p60 will show total combined earnings after pension contributions have been deducted, effectively meaning the first £400 a month i earn self employed will not be of any benefit in the amount i can borrow.
Is there anyway around this?
Many thanks

You will need to check with the lender as to what they will accept as proof of earnings.

For your PAYE employment, they may be prepared to accept wage slips. As you correctly say, a P60 only shows taxable pay (i.e. after deduction of your occupational pension contributions)
Your lender may decide they want to contact your employer to verify what your gross salary actually is, and they will need your permission to do this. Also, inform your employer if you become aware of this, as your employer probably won't release the information without your express consent (and your employer may not contact you, but be waiting for you to tell them)

In regards to self employment, many mortgage lenders will want to see accounts, typically for last 3 years, and often only accept them if they have been produced by a professional accountant.

These conditions vary by lender (but are based on my own experience of a limited number of mortgage lenders). Check with the lender you are using as to what they will accept.

Pascal666

Yes but both the p60 and tax overview only show taxable income.
The pension contributions are not taxable and therefore dont show as income unlike on a payslip.

LRmortgage

If you want to use PAYE income and self employed, some lenders will allow you to use your pay slips to evidence the PAYE + tax calculations to prove the self employed element.

I’d suggest using a broker to manage this for you. They will know the procedure.