Class2 NI to get 2 years contribution for £164 PA with income under £1000 - is it really possible?

molerat

https://www.gov.uk/pay-class-2-national-insurance

You need to register as self employed, you do not need to self assess unless your trading income is in excess £1000

From what you stated in your OP you will not be self employed, you will be employed by your wife & daughter's business so employee and not eligible to pay class 2.

Dazed_and_C0nfused

itsmeagain said:

Dazed_and_C0nfused said:

It is quite clear that someone who is self employed, registers as such with HMRC and completes a Self Assessment return (correctly) can pay voluntary Class 2 National Insurance.

Have you actually read through the latest Self Assessment return and self employments pages (and accompanying help notes) to see what is involved?

I have no idea why you thought this might not be possible, especially after the explanations in your other thread.

On this thread (and the last one), there was some Yes & No-ing, but there's a subtle difference this time. I'm specifically looking at the below £1000 income category for self employed that I showed on the link. Previously I was asking about the over £1000 category where I knew I'd have to fill in a self assessment & pay tax.

Because there is a category for above £1000 AND below £1000, I'm wondering if that makes any difference to the admin process involved?

You see, I put the question to HMRC (phone call) and they told me that I don't need to declare such low income, but the person that I spoke to didn't know anything about how I pay the class 2 NI in that scenario because that was another department!

So, was the person at HMRC correct? If so, do I become a special case where I still need to fill in a self assessment to permit the voluntary class2 in the same way as an over £1000 earner has to, or is there a special way of paying the NI for a sub £1000 earner that doesn't require the self assessment to get the class2 NI?

No I haven't read the notes - is there a link that you could share please describes the process for a sub £1000 self employed person paying class2 NI?

As previously explained, if you start your own business.

And register as such with HMRC.

And complete a Self Assessment return.

Then you will be able to pay voluntary Class 2 NI even if the self employment results in £0 profit.

The Self Assessment returns are all easily found on gov.uk.

https://www.gov.uk/government/publications/self-assessment-tax-return-sa100

https://www.gov.uk/government/publications/self-assessment-self-employment-short-sa103s

You cannot pick and choose which parts of this process you wish to comply with.  If you don't start a business you won't be registering had self employed with HMRC.

If you don't register as self employed they won't issue you with a notice to file a return.

And if you don't complete a return you won't have the opportunity to pay voluntary Class 2 National Insurance.

itsmeagain

Dazed_and_C0nfused said:

if you don't complete a return you won't have the opportunity to pay voluntary Class 2 National Insurance.

Thanks but this is what confuses me when molerat posts this below, which appears different and I don't know who's correct;

https://www.gov.uk/pay-class-2-national-insurance

You need to register as self employed, you do not need to self assess unless your trading income is in excess £1000

The above implies to me that it is possible to register as self employed, and use the method above, albeit they don't specifically mention the 'under £1k' reason for not filing a tax return in the list.

The other people that have previously house sat for the partnership are asked to fill in an invoice that the partnership keep as a record of their expenses.

Dazed_and_C0nfused

itsmeagain said:

Dazed_and_C0nfused said:

if you don't complete a return you won't have the opportunity to pay voluntary Class 2 National Insurance.

Thanks but this is what confuses me when molerat posts this below, which appears different and I don't know who's correct;

https://www.gov.uk/pay-class-2-national-insurance

You need to register as self employed, you do not need to self assess unless your trading income is in excess £1000

The above implies to me that it is possible to register as self employed, and use the method above, albeit they don't specifically mention the 'under £1k' reason for not filing a tax return in the list.

The other people that have previously house sat for the partnership are asked to fill in an invoice that the partnership keep as a record of their expenses.

You don't need to if your business turnover is no more than £1,000 (and you don't have any other reason to complete one).

But if you choose not to how will you be able to pay voluntary Class 2 NI?

The link you have given lists some scenarios where a Self Assessment return might not be needed.  Running a normal small business in the UK isn't one of them.

You do not pay through Self Assessment if you’re any of the following:

an examiner, moderator, invigilator or person who set exam questions

running a business involving land or property

a minister of religion who does not receive a salary or stipend

living abroad and paying voluntary Class 2 contributions

a person who makes investments - but not as a business and without getting a fee or commission

a non-UK resident who’s self-employed in the UK

working abroad

itsmeagain

Dazed_and_C0nfused said:

itsmeagain said:

Dazed_and_C0nfused said:

if you don't complete a return you won't have the opportunity to pay voluntary Class 2 National Insurance.

Thanks but this is what confuses me when molerat posts this below, which appears different and I don't know who's correct;

https://www.gov.uk/pay-class-2-national-insurance

You need to register as self employed, you do not need to self assess unless your trading income is in excess £1000

The above implies to me that it is possible to register as self employed, and use the method above, albeit they don't specifically mention the 'under £1k' reason for not filing a tax return in the list.

The other people that have previously house sat for the partnership are asked to fill in an invoice that the partnership keep as a record of their expenses.

You don't need to if your business turnover is no more than £1,000 (and you don't have any other reason to complete one).

But if you choose not to how will you be able to pay voluntary Class 2 NI?

The link you have given lists some scenarios where a Self Assessment return might not be needed.  Running a normal small business in the UK isn't one of them.

You do not pay through Self Assessment if you’re any of the following:

an examiner, moderator, invigilator or person who set exam questions

running a business involving land or property

a minister of religion who does not receive a salary or stipend

living abroad and paying voluntary Class 2 contributions

a person who makes investments - but not as a business and without getting a fee or commission

a non-UK resident who’s self-employed in the UK

working abroad

Thanks - I wasn't sure it was an exhaustive list, so maybe molerats answer was not appropriate to my circumstance/question. I have since found the gov site part that lists the class 2 NI as one of the reasons you must still do an under £1k self assessment.

So - are you agreed that if I register, fill in a self assessment & pay class 2 NI, invoice the partnership for my work (like all the other people that occasionally pet sit for them), then it qualifies as self employed and all ok in what i'm doing, or is there anything else stopping this - (because there are people on here claiming that my wife/daughter would be employers).

Also (may be obvious to you), I assume I still get the under £1k tax free trading allowance after filing the self assessment?

Dazed_and_C0nfused

itsmeagain said:

Dazed_and_C0nfused said:

itsmeagain said:

Dazed_and_C0nfused said:

if you don't complete a return you won't have the opportunity to pay voluntary Class 2 National Insurance.

Thanks but this is what confuses me when molerat posts this below, which appears different and I don't know who's correct;

https://www.gov.uk/pay-class-2-national-insurance

You need to register as self employed, you do not need to self assess unless your trading income is in excess £1000

The above implies to me that it is possible to register as self employed, and use the method above, albeit they don't specifically mention the 'under £1k' reason for not filing a tax return in the list.

The other people that have previously house sat for the partnership are asked to fill in an invoice that the partnership keep as a record of their expenses.

You don't need to if your business turnover is no more than £1,000 (and you don't have any other reason to complete one).

But if you choose not to how will you be able to pay voluntary Class 2 NI?

The link you have given lists some scenarios where a Self Assessment return might not be needed.  Running a normal small business in the UK isn't one of them.

You do not pay through Self Assessment if you’re any of the following:

an examiner, moderator, invigilator or person who set exam questions

running a business involving land or property

a minister of religion who does not receive a salary or stipend

living abroad and paying voluntary Class 2 contributions

a person who makes investments - but not as a business and without getting a fee or commission

a non-UK resident who’s self-employed in the UK

working abroad

Thanks - I wasn't sure it was an exhaustive list, so maybe molerats answer was not appropriate to my circumstance/question. I have since found the gov site part that lists the class 2 NI as one of the reasons you must still do an under £1k self assessment.

So - are you agreed that if I register, fill in a self assessment & pay class 2 NI, invoice the partnership for my work (like all the other people that occasionally pet sit for them), then it qualifies as self employed and all ok in what i'm doing, or is there anything else stopping this - (because there are people on here claiming that my wife/daughter would be employers).

Also (may be obvious to you), I assume I still get the under £1k tax free trading allowance after filing the self assessment?

I'm not an employment law expert so don't know if you would be genuinely self employed or not.

Although it seems like your relatives are the ones with most at risk if HMRC determined that the people they engage should have been registered as employees.

Also (may be obvious to you), I assume I still get the under £1k tax free trading allowance after filing the self assessment?

No, it is part of the process of completing the Self Assessment return, not something that happens after completing the return.

itsmeagain

Dazed_and_C0nfused said:

Also (may be obvious to you), I assume I still get the under £1k tax free trading allowance after filing the self assessment?

No, it is part of the process of completing the Self Assessment return, not something that happens after completing the return.

Apologies - I'm not talking about the timing of events. I'm asking... if I fill in the self assessment, do I still get the £1k trading allowance that I would have got if I hadn't done the self assessment. I.e, do you get the £1k trading allowance whether you do a self assessment or not?

Dazed_and_C0nfused

itsmeagain said:

Dazed_and_C0nfused said:

Also (may be obvious to you), I assume I still get the under £1k tax free trading allowance after filing the self assessment?

No, it is part of the process of completing the Self Assessment return, not something that happens after completing the return.

Apologies - I'm not talking about the timing of events. I'm asking... if I fill in the self assessment, do I still get the £1k trading allowance that I would have got if I hadn't done the self assessment. I.e, do you get the £1k trading allowance whether you do a self assessment or not?

You would probably be best looking through the paper returns on gov.uk.

itsmeagain

Dazed_and_C0nfused said:

itsmeagain said:

Dazed_and_C0nfused said:

Also (may be obvious to you), I assume I still get the under £1k tax free trading allowance after filing the self assessment?

No, it is part of the process of completing the Self Assessment return, not something that happens after completing the return.

Apologies - I'm not talking about the timing of events. I'm asking... if I fill in the self assessment, do I still get the £1k trading allowance that I would have got if I hadn't done the self assessment. I.e, do you get the £1k trading allowance whether you do a self assessment or not?

You would probably be best looking through the paper returns on gov.uk.

Many thanks for your patience. It's not easy to find discussions on examples of people with a self employed income of less than £1k that want to do a tax return just to pay class 2 NI.

Even when you call HMRC they tell you that you a return for less than £1k but they don't know how to pay the class 2!

Having agreed to do some self employed work for them, It's seems silly to throw away the opportunity to get the extra NI contributions at £164 instead of £825 if it can all be delivered legitimately.

Altior

So you're fully retired, income circa £40K, and still planning to invoice your own daughter for doing her a favour and occasionally looking after somebody else's dog for her? Is it really worth all that faff, researching legislation, creating invoices and tax returns for a few quid off her? If it was me, I'd be inclined to do it gratis, or be treated to the odd meal out if you really feel the need to 'earn' out of the scenario.