Tax Returns

I didn’t add anything extra to the self assessment, simply confirmed the info they had. So that’s why I’d assume a tax code change

that’s why I’d assume a tax code change

There's a tick box somewhere in the self assessment flow where you can choose to have small outstanding liabilities collected through a code change. The default is to send them the lump sum by the end of today.

If all your income is covered by P60(s), it's up to HMRC to figure it out, and they do.

I think, and I could well be wrong on this so happy to be corrected, that if you want any unpaid tax to be collected via a change to your tax code, you had to file your return much earlier than today.

Finished, 4 hours before the deadline. A new record. I normally leave it much later than this...

much earlier

Well, a month earlier

Also, they default to collecting through your tax code if you are eligible and if doing so meets their various conditions.

Been a basic PAYE bitch since forever (and will continue in the near future) but I might have a bit of extra work coming up that could be too good to turn down. Is there a tax calculator that will take account of PAYE and a 2nd income?

Failing that can anyone explain to me (because most websites talking about this stuff assume you have a clue) what the fuck it actually means to claim an expense. Like if I set up as sole trader (along side my day job) and make 10k on a job, but spend half of it on a computer to do the job, then do nothing for the rest of the year, am I just paying income tax & NI on the remaining 5k? (Ignoring 1k trading allowance for now).

Also at what point does business use become personal use if I'm not actually earning money with the kit but using it for work related stuff? I'm not going to using it for a gaming PC, but likely to be building a portfolio, R&D etc with a view to transitioning toward self-employment, but unlikely to be doing loads of paid work for the near future.

Is there a tax calculator that will take account of PAYE and a 2nd income?

Yes, and it's at the end of your self assessment form 😀 I have a spreadsheet to calculate my upcoming tax liability, it's not rocket science, especially since they aligned all the thresholds.

what the fuck it actually means to claim an expense.

"claiming an expense" just means keeping a record of the outgoing payment, typically a receipt showing what you bought and for how much, recording that in your business accounts, and then typing the totals into your self assessment return.

Like if I set up as sole trader (along side my day job) and make 10k on a job, but spend half of it on a computer to do the job, then do nothing for the rest of the year, am I just paying income tax & NI on the remaining 5k?

Yes, at that level, you'll be doing a two line tax return (total income, total expenses) on what's known as a "cash basis" where you write off capital investments when you make the payment, rather than "accrual" where you write off the capital value progressively over the life of the asset. You can do that for pretty much anything except cars.

Also at what point does business use become personal use if I'm not actually earning money with the kit but using it for work related stuff? I'm not going to using it for a gaming PC, but likely to be building a portfolio, R&D etc with a view to transitioning toward self-employment, but unlikely to be doing loads of paid work for the near future.

If you're using it for business development, it's still a business asset. They're not bothered if you use the same computer to play games in the evening, because life is too short and it's not the kind of thing which is easily partitionable. If you cease trading and keep such assets for your own use, you should allocate a realistic disposal value as trading income.

Is there a tax calculator that will take account of PAYE and a 2nd income?

Just to expand on this, the tax part is easy, the rates and thresholds cover the aggregate of employed and self-employed income. National Insurance is a shitshow, budget for paying class 2 and class 4 as though you don't have a PAYE job, and you might get some back after you submit your tax return based on some arcane algorithm which takes account of the class 1 NI which has been deducted from your PAYE income.

cash basis

Thanks for the explanations! I knew I had to do this, but didn't know what the implications were.

National Insurance

That reminds me, one thing (another thing) I was confused about is class 2 NI being accrued on a weekly basis, is that always 52 weeks if the tax year? If I wrap up the company after the work dries up, would I just count that amount of time? (Though as you say I'd then need to pay for the disposal of the assets to myself so probably not worth it).

If I wrap up the company after the work dries up, would I just count that amount of time?

Yes, if you declare a cessation date then your class 2 stops there. These days, you only pay class 2 once your annual profits exceed £12570. Some years have 53 NI weeks as it's nominally charged on Saturday for the preceding 7 days. In practice you get a bill for 52/53×£3.45 (if you have made enough profit) along with any other tax and NI due as one big lump to be paid by 31st January.

Ah right I'd gotten myself confused between the small profits threshold and the lower profits limit. So no NI until £12570 profit and if I'm making much more than that it's probably not too much to pay £3.45 for a while in case more work comes in. Sounds like if I just dump anything over 50k total income in my pension then I can claim back the higher rate tax too via the tax return. Thanks, I feel like I know what I'm getting in to a lot more now 🙏.

Reading up it seems weird that between 6725 and 12570 you don't need to pay NI yet below 6725 you need voluntary contributions to get state pension, unless I've misunderstood. Anyway, hopefully that doesn't affect me.

seems weird that between 6725 and 12570 you don't need to pay NI yet below 6725 you need voluntary contributions to get state pension

It is weird, but as I said NI is a shit show due to legacy issues of being a tax which pretends to be an insurance scheme, with means testing subsidised by redistributing money stolen from the rich.

Been putting it off all day, but I have now submitted my 2023/24 tax return🙂

Can vocational training be legitimately written-off?

I normally just submit a lump sum for expenses and "fly under the radar", but this year I've done more training and less work than usual, which makes the earnings/expenses ratio look a bit off.

Can vocational training be legitimately written-off?

Yes, in certain circumstances
https://www.gov.uk/expenses-if-youre-self-employed/training-courses

New tax dodge just dropped:

Snail farm in city office sparks tax avoidance probe

A city centre office building has been home to a snail farm for more than a year, in what council bosses allege is an attempt to avoid tax.

About 15 covered crates - containing as few as two snails each - have been kept on the lower ground floor of 9 Dale Street, in Liverpool, since 2023.

Under current law, this could qualify as "agricultural use" and this part of the building would arguably be exempt from business rates.

The firm renting the space said it was a legitimate snail farming operation.

having had a few years with a slightly more considered tax form completions I don't think I have the mental capacity this year to face down reality - any good recommendations for tax accountants for what is a very simple tax return filing (if you're not me)?

I haven't used them myself, although I think I will for last year's tax return, but a colleague recommended Tax Scouts, who charge £169 for completing a self assessment.

http://www.taxscouts.com

£169 is good price for this.

Where can I find a copy of my 2023-24 PAYE coding notice?* You know the one Self Assessment refers to when it asks you to check if you were paying back underpaid tax, despite it being obviously stupid to ask the tax payer to do that.

I asked ChatGPT but I think its knowledge is out of date. Suspect I've filed away the hardcopy, as in lost it.

Personal tax account via Government gateway?

Yeah but where in there? You can go back and look at the individual tax codes for each year but you can't find a pdf of the p2 - at least, I can't.

Super silly question: as I haven’t done any locum shift before 27/04/24, do I have to bother to file a SA return or will be next year? Thankssss

Assuming your accounting year is the same as the tax year, earnings on or after 6th April 2024 go on your 2024-2025 return, which you need to submit and pay by 31st January 2026