Very Small Biz, Tax and paying NI contributions

dennishopper

00ec25 wrote: »

either you were self employed for 52 weeks of 18/19 or you weren't


if you were, then select the option to pay class 2 voluntarily on your 18/19 tax return (at pro rata rate if <52 weeks)

I was self employed but it was not regular income and I also spent a few months out of the country last year. I’m happy to pay my voluntary NI contributions, however keen to pay the minimum if possible. It sounds like my self declared profit (is that the correct term) in this period of £6k approx is the amount where I can pay Class 2 vs Class 3?

martindow

dennishopper wrote: »

quite hard to show the profit actually beyond what I say it is, that being said I definitely want to pay what I should be now that I’m back in the U.K.

You don't say what your profit is; it is your turnover minus your expenses and your accounts should justify what you declare. It is quite rare for HMRC to carry out an inspection but if they do your books need to be accurate.

dennishopper

Profit varies but it is in the £5-8k region per annum. It’s quite complex and hard to prove what my profit is. Bizarrely, on paper, it will likely look less than it is however I’m keen to declare what it actually is and pay the corresponding NI contributions.

martindow

dennishopper wrote: »

Profit varies but it is in the £5-8k region per annum. It’s quite complex and hard to prove what my profit is. Bizarrely, on paper, it will likely look less than it is however I’m keen to declare what it actually is and pay the corresponding NI contributions.

I still don't understand this, Dennis. You will know your turnover exactly and if you tot up all of the allowable expenses you will end up with a figure that is your taxable profit.


Could you explain how this can be so flexible? HMRC would look at your expenses to see which are justified or not. You obviously should include all expenses that are allowable. It may be worth seeing an accountant to set up your accounts and to be sure everything is in order. Once it's set up correctly you should be able to carry on by doing it yourself.