Am I correct that when declaring your Income for SE and if you have both the above then you will be taxed on both?
even though you have paid paye through your wages when you were employed? this doesn't seem fair but I do expect there is a valid reason, could someone kindly explain so that I am able to fully understand. This may seem like a silly qu but I am very keen to know the answer....
Yes all income whether it be via employed or self employed basis will be taxed. On the SE form you enter details of you employed status / earnings as per P60, you then complete a self employed sheet and detail your turnover (money earned before any expenses etc.,) and you will complete the necessary boxes for your business expenses incurred via self employed status such as professional fees, motor, stationery etc.,
You will then be left with a figure which will be what you are taxed on.
Thank you Julie, just that I thought when you were employed you were taxed via PAYE and can't fully grasp being taxed again on the Self Assessment Tax Return.
You are only taxed once. If employed, you are taxed via PAYE. The taxed paid is declared on the employment pages which ensures you are only taxed on that income the once.
If a person either employed or self employed has any sort of complicated tax situation (eg may rent out a house, may have investment income, etc) then that person is required to complete a self-assessment tax return as all income whether earned or unearned is subject to tax. There are different SA forms and the relevant ones should be completed. This is to ensure that the tax paid is correct, neither over or underpaid. When employed and self employed two forms are completed the income added together, the personal allowance deducted, any tax paid from employment deducted and the difference is what is owed.
