Tax on self-employed 2nd job

BudgieTLH

Good afternoon, my first post! Sorry if the questions have been done to death but I had trouble finding anything specific.

I'm currently employed full-time and earn around £20k a year from that.

I've recently started a 2nd job outside of that which i'm self-employed in. I expect to earn around £2-£3k a year from this.

I'm aware that there is a £1000 allowance for self-employed people, but does this apply if you've got another job with a larger income? If it does apply, do I get an allowance of £1000 regardless, or if I earn £1001 does all of it become taxable?

I'm repaying a student loan, will my self-employed earnings be treated separately from my main income meaning it'd be inside the threshold, or will I need to add it to my main at the end of the tax year?

Thank you for your time

00ec25

Ok lets start with the basics

the self employed pay income tax and NI on the profit they make
a profit is income minus expenses

the "trading allowance" is an HMRC way of making your life easier when working out your profits, you have 2 choices, you must pick one for each tax year (you can change from year to year):
a) income - £1,000 = taxable profit
or
b) income - actual expenses you paid for self employment = taxable profit

Obviously b) involves more admin since you must keep receipts and records to substantiate the expenses. For a) you need keep nothing, as the £1,000 is a lump sum that requires no paperwork, but obviously if your actual expenses are >£1k there is a strong case for using option b)

income tax
having worked out your profit, it is added to all your other sources of income: employment salary, savings interest received, investment dividends received, etc, to give your total taxable income

from your total taxable income you deduct your personal allowance (11,850 at 18/19 rate) to get the total income subject to tax.

That determines if you have crossed over from basic to higher rate
if your total income subject to tax is <34.500 you pay tax at 20% on that sum
if >34,500 you pay 20% on the 34.5 and then 40% only on the amount over 34.5
obviously any tax you have already paid (such as through PAYE on employment) is deducted from the tax calculated above, and that will leave you with a net amount of tax due to be paid when you submit your tax return
(if you live in Scotland google it yourself as their numbers are different.)

national insurance is different
for the self employed you only pay NI on your profit figure if it is > £6,205
remember that is the profit figure, not the income figure

the rest you can look up yourself there are lots of websites that explain how tax works