i have been laid off and looking to go self employed

[adamh22]

hey all new here, i have just been laid off at the end of my apprenticeship and have weighed my options up and goin subby seems to be the only option at can any one give me any advice on the:

paper work side of it
who pays the tax
and producing invoices

i have been given offers from 2 contractors however not through an agency so wondered if this was differt would i have to pay my own tax even if i was signed up to the cis and had utr

 

[Toby Kuhnert]

Hi, welcome to the forum
You would invoice the contractors, Make sure you sign up with HMRC as self employed etc etc get registered with CIS and make sure you know your UTR. Put both CIS and UTR numbers on your monthly invoice (for example) then at the end of each month the contractor will give you a CIS statement with how much they have deducted (think its around 20%) then at the end of you tax year, HMRC will refund you the difference from what they took through the contractor (if any). Normally you would get something. Hope this helps i'm not the best in wording explanations!!
Toby

 

[adamh22]

thats great cheers i was getting right confused getting my head round it but how work is atm i havent go much choice so hope this will work out lol cheers

 

[VoltzElectrical]

Hi, welcome to the forum
You would invoice the contractors, Make sure you sign up with HMRC as self employed etc etc get registered with CIS and make sure you know your UTR. Put both CIS and UTR numbers on your monthly invoice (for example) then at the end of each month the contractor will give you a CIS statement with how much they have deducted (think its around 20%) then at the end of you tax year, HMRC will refund you the difference from what they took through the contractor (if any). Normally you would get something. Hope this helps i'm not the best in wording explanations!!
Toby

Not quite. You only get a Unique Tax Reference (UTR) number.

But other than that, then yes. Start work, invoice however they want i.e. weekly, fortnightly, monthly, keep a copy for your records.

Then, and this is important - keep a record of your mileage, expenditure for accountant, tools, PL insurance, clothes etc, etc, etc.

Then, at the end of the tax year, contact a reputable accountant to help you settle the difference between what you have paid in tax (20 % on EVERYTHING you have earned) as opposed to what you should have paid, which is 28% (tax and class 4 NI) MINUS allowances (£8k or so in personal allowance, 45p per mile (first 10,000 miles), all tools, clothing, accountant etc..).

You will nearly always get a refund of £1000 - £3000 depending on what you have earned and how many tax deductible expenses you have.

Hope that helps.

 

[snowhead]

Then, at the end of the tax year, contact a reputable accountant to help you settle the difference between what you have paid in tax (20 % on EVERYTHING you have earned) as opposed to what you should have paid, which is 28% (tax and class 4 NI) MINUS allowances (£8k or so in personal allowance, 45p per mile (first 10,000 miles), all tools, clothing, accountant etc..).

When you're starting up, it's best to find an Accountant at the start and ask them how they want the records keeping.

 

[VoltzElectrical]

perhaps. but shop around. Never pay more than £250 including VAT for a self assessment return.

Keep everything, and get into the habit of keeping a mileage record from, and to destination and mies done.

 

[adamh22]

Thats great cheers just hope the work comes in

 

[VoltzElectrical]

although we all hate them, register with the agencies. I've had two texts this week for local starts at £14 an hour.

 

[adamh22]

Yh i am doin apllued online for a couple gotta ring round tommorrow

 

[Toby Kuhnert]

Not quite. You only get a Unique Tax Reference (UTR) number.

But other than that, then yes. Start work, invoice however they want i.e. weekly, fortnightly, monthly, keep a copy for your records.

Then, and this is important - keep a record of your mileage, expenditure for accountant, tools, PL insurance, clothes etc, etc, etc.

Then, at the end of the tax year, contact a reputable accountant to help you settle the difference between what you have paid in tax (20 % on EVERYTHING you have earned) as opposed to what you should have paid, which is 28% (tax and class 4 NI) MINUS allowances (£8k or so in personal allowance, 45p per mile (first 10,000 miles), all tools, clothing, accountant etc..).

You will nearly always get a refund of £1000 - £3000 depending on what you have earned and how many tax deductible expenses you have.

Hope that helps.

Yeah of course, doh!!

 

[ExArmy]

i do my own self assessment. it's quite simple, add up your gross income (before tax) and add up al your expenses and deduct them from the gross income, then deduct the personal allowance and the figure your left with is what you need to pay tax on. eg:

gross income £50,000
expenses £20,000
personal allowance £9440
£50,000 - £20,000 - £9,440 = £20560

so you then need to pay tax on £20,560, so you work out 20% of it = £4112
and also class 4 national insurance which is 9% of 20560 which is £1850
and if you figure this out at the end of the tax year, say may 2014 you will have completed the return for 2013-2014, you have to pay the £5962 tax & NI total before january 2015

and then if you get paid through CIS, you will already have paid 20% on £50,000 which is £10,000, so you will get a rebate of (£10,000 - £5962) = £4038