working freelance

axisus

I was thinking of doing some freelance work on the side to raise extra dosh, and keeping some of it out of the GAS fund to cover tax, but presumably one also has to allow for National Insurance as well? Suddenly it seems like you are not getting much of the money you earn!

It doesn't seem so bad when you get a wage slip and they have stripped all that out already. To have it in your hot sweaty palm and have to hand it over seems much harder!

Grunfeld

axisus said:

It doesn't seem so bad when you get a wage slip and they have stripped all that out already. To have it in your hot sweaty palm and have to hand it over seems much harder!

As soon as I get paid I transfer the necessary to a different bank account.  Psychologically it's like, "that's out of the way now."  And when you have to pay, you've got it all in your "provisions" account.  It's just a mind trick but it keeps me happy!

robinbowes

I'd recommend seeing an accountant.

R.

guitari

If you are already registered PAYE and paying NICs then there is an allowance to earn some extra cash without paying additional NICS (Class 2), used to be around £4k but you'd be better checking with current rates. The additional earnings are still taxable at full rate though.

TheMarlin

robinbowes said:

I'd recommend seeing an accountant.

R.

a BIG +1.

A good accountant will ensure you pay as little tax as possible,  You can do the tax yourself, but you'll just end up ripping yourself off!

Why do you think Jimmi Carr paid no tax over that last five years?  he has a damn good accountant, who knows all the dodges,

Marlin

guitari

Just looked to satisfy myself. With a small earnings exception you can earn up to £5885 without paying additional NI.

https://www.gov.uk/self-employed-national-insurance-rates

shuikit

guitari said:

Just looked to satisfy myself. With a small earnings exception you can earn up to £5885 without paying additional NI.

https://www.gov.uk/self-employed-national-insurance-rates

I could be wrong, but my understanding is that this is an allowance from the total amount of income that you have, so assuming that your 1st income is above this theshold then the 2nd income would just have the full rate applied to it.

guitari

It would be if both incomes were from self-employment.

If you are an employee paying NIC through PAYE then you can still use your full self employment entitlement for your second income.