UK Workers, P60 form & NIC

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Hi,

I have a friend who's had a part-time teaching job for the past year, and is just getting her accounts in order, then I usually help her to submit it online.

She told me originally that this teaching job hired her as a self-employed contractor, which is quite usual for a music teacher. However, she told me now that they deduct NIC at source (she hasn't mentioned income tax deductions, but I'll check). They also issued her with a P60 form. Given this, am I right in saying that she is not actually self-employed for this job? Is she most likely a worker? I've checked the various test that decide if someone is self-employed or a worker, and it suggests she's the latter. Also, I expect that she's a worker as opposed to an employee.

Also, is it usual to have NIC deducted, but not income tax? If so, how does that work with the tax return?

Thanks for your help.
 

Truemanbrown

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If the contractor has given her a Form P60 then she must be employed. If she is employed then she should be receiving a payslip for each payment with specific information on it.

With regards to NIC being deducted, but not Income Tax (PAYE) how much income did she receive from this job. Remember that your friend receives a personal allowance which for 2021/22 is £12,570. I am assuming that the tax code on the Form P60 was 1257L. If her income was less than £12,570 from this employer then she will probably not be paying income tax.

With regards your friend's tax return, I would make the following points:-

  1. the income from this employer should be shown on an employment section (Form SA102);
  2. if she is preparing accounts as a self-employed contractor, then the income from this employment should be discounted when preparing the accounts;
  3. any expenses relating to the work done for this employer should be reviewed to see if they can claim tax relief on them.
 

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