Self Employed tax effectively doubling in 2008-2009?

joharm

I work as a self-employed freelance multimedia designer. At the moment I am earning roughly £12,000 - £14,000. I work from home, so have allowable expenses for bills, plus I have expensive computer equipment/software etc.

My taxable profits (minus allowable £5225 and expenses) mostly fall into the 10% tax band.

In 2008-2009 this band is being scrapped. This means that instead all of my profits will fall into the 20% band. This means that my tax almost doubles!

Is anyone else going to be much worse off after the change?

Mikeyorks

If you can reduce £14k to £7k (ish) taxable .... that's a lot of expenses! Makes no difference whether you're self-employed or employed ... the abolition of the 10% band has similar effect if you don't currently have enough taxed at 22% (will reduce to 20%) to offset the loss of the 10%.

Previous merged thread on it here :-

http://forums.moneysavingexpert.com/showthread.html?t=758941