Issues to be aware of when going PAYE while already being self employed?

winterwonderz

Are there any tax surprises that I need to be aware of ... I have run my own small gardening business (sole trader/no VAT) for 3 years and complete my self assessment annually online paying my tax and NI.

I have been offered a 9 month contract carrying out a project for a private school (2 days per week) so will be salaried while also continuing my own gardening for 3 days per week.

I assume I will be on an emergency tax code next month and into 2024 when I start?  Is there anything else that I need to be aware of? Should I inform HMRC myself prior to starting at the school?

Thanks for any advice.

Marcon

winterwonderz said:

Are there any tax surprises that I need to be aware of ... I have run my own small gardening business (sole trader/no VAT) for 3 years and complete my self assessment annually online paying my tax and NI.

I have been offered a 9 month contract carrying out a project for a private school (2 days per week) so will be salaried while also continuing my own gardening for 3 days per week.

I assume I will be on an emergency tax code next month and into 2024 when I start?  Is there anything else that I need to be aware of? Should I inform HMRC myself prior to starting at the school?

Thanks for any advice.

No need to inform HMRC. The school will (should!) ask you to complete a new starter form, which will then generate a tax code for them to use in respect of your earnings from the school.

Hopefully you'll be earning enough to qualify for auto-enrolment and get the benefit of employer pension contributions.

Dazed_and_C0nfused

The emergency tax code is 1257L so on two days a week you probably won't have any tax deducted at source and will pay everything via your Self Assessment return.

An alternative would be to complete statement C on the new starter declaration and then you should be put on tax code BR (basic rate) and will have some tax deducted which will be credited on your Self Assessment calculation (assuming you complete your return correctly!).

zedonk

Make sure you keep all your payslips and P60s, as when you file your tax return you also have to report your income from employment and any tax that was deducted.

winterwonderz

Thanks everybody - some useful points to note here!

Marcon

zedonk said:

Make sure you keep all your payslips and P60s, as when you file your tax return you also have to report your income from employment and any tax that was deducted.

Happily HMRC will pre-populate an online self assessment tax return with that information.