How much tax should I pay?
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tedbear
Posts: 22 Forumite
in Cutting tax
Hi All, I took early retirement and then went UTR to do a few days a week.
I receive my pension from my firm and my wages from the small firm I work for.
I am stopped 20% tax at source on my wages and of course pay an amount of tax on my pension.
So what percentage of tax would I need to pay?
I paid and accountant £240 to do my return as I believed I would gat some tax back, but he has sent me a letter stating that will I owe an extra £411 in tax.
I am willing to put up my actual figures if needed,,, regards Ted
I receive my pension from my firm and my wages from the small firm I work for.
I am stopped 20% tax at source on my wages and of course pay an amount of tax on my pension.
So what percentage of tax would I need to pay?
I paid and accountant £240 to do my return as I believed I would gat some tax back, but he has sent me a letter stating that will I owe an extra £411 in tax.
I am willing to put up my actual figures if needed,,, regards Ted
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Comments
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Your post is a bit confusing.
What does then went UTR to do a few days a week mean?
Why did you think you would get some tax back?
Which country do you live in?
Figures really would help a lot. Tax is all about the detail.0 -
Dazed_and_confused wrote: »What does then went UTR to do a few days a week mean?
Must mean that he went self-employed.
If you have already paid tax on your pension and wages then presumably the £411 tax due is from your self-employed income.
What was your total combined income for the year?0 -
Apologies if my post confused,,, yes I did go self employed.
My pension gross is £17,013 (tax deducted £1,110)
my self employed gross is £10,752 (from which I am stopped tax at source at 20%)0 -
How does the accountant explain the £411?
You'd better explain "my self employed gross ... from which I am stopped tax at source", too0 -
As you can tell, I am a little confused by all this myself.
I guess its 40 years of being PAYE.
The firm I work for part time deduct my tax and I assume pay this to the tax man.
I guess thats how it works. Thanks for all the input...0 -
As you can tell, I am a little confused by all this myself.
I guess its 40 years of being PAYE.
The firm I work for part time deduct my tax and I assume pay this to the tax man.
I guess thats how it works. Thanks for all the input...
Judging by your earlier posts it would appear that you are working under the scheme known as "Construction Industry Scheme (CIS) subcontractor" This is not something I know a lot about but from a quick read it suggests that you have 20% tax deducted and then do a self assessment for tax and national insurance. This would suggest to me that the bulk if not all of the owed money would be for NI rather than tax.
Hopefully someone will be along who has more experience with CIS who can check your figures but on my limited knowledge they do not look far adrift assuming you are liable to pay NI.0 -
So how does the accountant explain the £411?0
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Being self employed means you pay the tax you are due and you also have to pay half again as a prepayment on your following year's tax, when you complete your final tax forms it works itself out.0
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Being self employed means you pay the tax [STRIKE]you are[/STRIKE] due and you also have to pay half again as a prepayment on your following year's tax, when you complete your final tax forms it works itself out.
Aren't you confusing the interaction between self-employment and Payments on Account?
Self-employed income will influence whether PoA will be applied, but it doesn't automatically invoke it.0 -
Without knowing your net self-employed income it's impossible to say why you owe tax.
However you say you took early retirement so I assume you are not of state pension age? If so then you will be due to pay class 2 NIC and possibly class 4 depending on your profits.0
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