Both Employed and Self Employed?


S

SimonJ

If someone is working for an employer, on a fully employed PAYE basis, then
they set their own business up, working on their spare time, how would they
work their income tax?

Could the employer make them stay on PAYE, or could the employee insist on
receiving their full pay before tax, and accounting for all the tax
themselves?
 
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R

rob

SimonJ said:
If someone is working for an employer, on a fully employed PAYE
basis, then they set their own business up, working on their spare
time, how would they work their income tax?

Could the employer make them stay on PAYE, or could the employee
insist on receiving their full pay before tax, and accounting for all
the tax themselves?
An amature answer:

They would register as Self Employed within 3 months.

The Inland Revenue would send them a tax return. They would fill in
separate sections for their employment and self-employment.

They may be able to have the owed tax collected through the next year's
PAYE.

The IR may also change a tax code to collect extra tax during the year that
it is being earned outside of employment.

In short, the employed income tax will be collected by PAYE. The Self
Emploeyed income may be collected by PAYE in arrears or in future years, in
advance of the tax return.

Employment NI will be collected by PAYE.
Self Employment NI, if applicable, will be collected by monthly DD or
quarterly bill, and via the Tax Return.
 
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T

tim.....

SimonJ said:
If someone is working for an employer, on a fully employed PAYE basis,
then they set their own business up, working on their spare time, how
would they work their income tax?

Could the employer make them stay on PAYE,
No, the Inland Revenue will, which amounts to the same thing.
or could the employee insist on receiving their full pay before tax, and
accounting for all the tax themselves?
No chance. In an employer/employee relationship, the employer
is always required to make the statutory deductions, even if one
is only contracted for a week.

tim
 

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