Employed and self-employed tax

plisken78

Hi, I am currently employed on a tax code of 0T (which is the correct code). I'm looking to also start a business as sole trader where I will be selling a service. I read somewhere that if you are a sole trader you do not have to register as self-employed until you earn £1000 per year at which point to you need to register and submit tax returns yearly...

However, as I am already earning in high tax bracket as employed does the £1000 self-employed cut-off go away, i.e. is £1000 all my combined earnings or are my employment and self-employment completely separate for tax purposes (but still all go in the one self-assessment)?...

Thanks

Dazed_and_C0nfused

The £1,000 relates to the "Trading Allowance" and this is separate to your employment.

If you already file a tax return then you would still have to register as self employed with HMRC but then it's just a case of adding an extra set of (self employment) pages to your tax return.

plisken78

Ah I see, thanks. So would any earnings under the self-employed part be taxed using my 0T bracket as well?

[Deleted User]

plisken78 said:

Ah I see, thanks. So would any earnings under the self-employed part be taxed using my 0T bracket as well?

Taking as read that 0T is the correct code at your employment, the first £37700 of your income is taxed at 20%. Anything above that is at 40%. Note that you have a separate 12570 free of NIC at your self-employment. 

plisken78

Thanks very much, I forgot about the NIC!