Tax thresholds for sole trader

dulcettones

I am registered as a sole trader with the Inland Revenue.
What I wondered is once I've deducted my expenses etc. from my total earnings - say I have a figure of 14k - does that mean that whole figure is taxed?
Or since I'm self-employed it a certain figure tax-free?
Regards, DT

Mikeyorks

Yes .. you're allowed £5435 free of tax (08-09) then (this table not updated until after the Budget 12th March) the rest of the £8.6k would be at 20% (reduced from 22% this year .... but the 10% band disappears) :-

http://www.hmrc.gov.uk/rates/it.htm

dulcettones

A friend of mine seems to think these are the figures for regular full time employment. And there are different figures for the self-employed. Is he talking nonsense?

fengirl_2

he is pulling your leg - why would there be different tax allowances and rates for self employed poeple?

Mikeyorks

dulcettones wrote: »

Is he talking nonsense?

The pure and undiluted kind!

The allowances are the same. It only appears to us PAYE captives that the self-employed enjoy preferential rates!