UK Employed/self employed

Judd · Jun 16, 2020

Hello, I'm currently employed full time by a company, I have been offered a job on call in the evenings one night a week, This second job requires me to be self employed, can anyone help and give guidance on what I need to do in regards to tax? Notify HMRC? Tell existing employer? Will a second job effect my earnings in my main job?
New to this but think it will be a nice taster into self employed work.
Thanks

telectrix · Jun 16, 2020

first, depends if your employment contract stipulates "thou shalt not do other works apart from mine". second. start off doing the self-employed jobs, keep all invoices and receipts. see how it goes for 3 - 6 months. if viable, then notify hmrc for self assessment. you'll then get a UTR number and can file tax returns on line.

Baddegg · Jun 16, 2020

As above mate you may find ya existing contact of employment will not permit you do another job.....

Judd · Jun 16, 2020

I'm pretty sure I'm in the clear having a second job but will have to double check. I wasnt aware i could start working and then sort out the laborious tax stuff later so thanks ?

Zerax · Jun 16, 2020

Alot of people are frightened of the HMRC... but in reality they're not that bad. Remember that we're all very small fry to them, and they're delighted when we pay them our taxes.

I know a guy who didn't file any tax returns for 4 years AND he had tax to pay... When it was all sorted, they just charged him some late filing fees and some paltry interest.

For you... assuming that you currently use all of your personal allowance for your 'employed job'... all of your 'self-employed' income will be taxable. And be careful if your total income tips you into the higher rate bracket. That can affect lots of other things too.

You'll also pay Class 1, Class 2 and Class 4 NIC... but if your self employment income is low, you'll probable be below limits. (Class 1 is deducted via PAYE for your existing employment, Class 2&4 via self assessment.

As already said... just keep all your invoiced/receipts etc. and see if it becomes a more regular thing... then take it from there.

123 · Jun 16, 2020

telectrix said:
first, depends if your employment contract stipulates "thou shalt not do other works apart from mine". second. start off doing the self-employed jobs, keep all invoices and receipts. see how it goes for 3 - 6 months. if viable, then notify hmrc for self assessment. you'll then get a UTR number and can file tax returns on line.

Is this correct? Would have thought you'd need to notify HMRC before doing any of the self employed work, and even if only receiving one payment as self employed you'd have to submit a tax return.
And if applicable it could be under the CIS scheme so would need to register for that as well or face 30% tax deduction at source.

pc1966 · Jun 16, 2020

If you are only doing jobs on the side that come to several/ten-ish £k per year then you should just be able to submit a self-assessment form and HMRC will tell you what you owe them.

But keep all receipts and save at least 1/3 of the extra income to cover tax/NI when the tax demand finally comes in. Most likely it will be less than 30% and you can treat yourself/better-half when you know the position.

But as already mentions make very sure it wont clash with you main job's contract terms.

Zerax · Jun 17, 2020

123 said:
Is this correct? Would have thought you'd need to notify HMRC before doing any of the self employed work, and even if only receiving one payment as self employed you'd have to submit a tax return.
And if applicable it could be under the CIS scheme so would need to register for that as well or face 30% tax deduction at source.

HMRC work in tax years... not on a daily basis. So as long as you deal with any tax etc. within the year (and for a tax year that ends on 5th April, you have until 31st Jan the following year), you'll be fine. The important thing is... if you know that you have tax to pay, you are legally obliged to request a tax return to complete. (Done via registering for self assessment)

As for CIS scheme... If the person/company you're invoicing is registered as a 'contractor', then you would be wise to register as a subcontractor to avoid the higher deduction, but you're not required to register if you don't want to. All your tax deductions are credited to your tax account, with any over-payments being credited back to you after you submit your tax return.