If I'm employed and self employed and paid class 1 ni via employment (paye) in 14/15 and then paid class 4 and class 2 via self employment in my 14/15 tax return as I am over the threshold for when it is due. Have I overpaid national insurance then in my employment as I am paying in my self employment?
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Although you are correct, the form to apply for small earnings exemption is no longer available. HMRC have introduced a form to "reclaim" NIC if paid when it is not due. e.g. if the self-employed earning are below the exception limit. I have had to supply the form to quite a few people after doing their tax returns. Including 1 client who HMRC changed his tax code to claim the past Class 2 NIC which he had never paid, due to his self-employed income having always been below the small earnings exemption limit. It seems they don't check before sending the bills out or changing tax codes.
Another service I now have to provide for clients - claiming back NIC which is not due.
This is just for reference and does not apply to the 14/15 year the OP has queried
When submitting a self assessment for 15/16 and beyond there will only be a liability for Class 2 NI if the self employed earnings are above the exception limit, and will be added to the income tax and class 4 calculation. If below the exception threshold limit, no NI will be charged.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Thanks John for the info. I hope you are right. I keep being told things by HMRC which turn out to be rubbish!
I recently spent months registering a sports club for CT, because HMRC insisted it could only submit a CT600 return online, using the software they offer. It took extra time, because HMRC in it wisdom decided to use the wrong address (a field), for the club so I struggled to get through the security checks. In fact I failed them a couple of times before I was able to pass them, so I could correct the address to the one they should have used in the first place, and which the clubs was registered as a CASC with HMRC! When I finally went to do it, HMRC's form didnt work at all, and then I found the comment - stating it was not suitable for clubs, so I ended up using my practice software to do it. Of course soon there will not be any CT600 forms available from HMRC.
-- Edited by YLB-HO on Tuesday 16th of February 2016 06:04:39 PM
There's a whole thread in that last sentence of yours Frauke!
Don't you love HMRC's response that taking free software away from agents will only cost them around £250 to buy a commercially available alternative! (there are cheaper alternatives than that such as Taxfiler. I'm just repeating HMRC's statement of arrogance).
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Sorry Shaun, but life as an Accountant dealing with HMRC has become that way. LOL..... HMRC are pushing everything back to the "Tax payer" and then fining them when they can't do it, get it wrong by accident or just give out wrong information. I actually got a apology letter from HMRC recently over several issues which they caused, but I would have rather they do things properly in the first place.
Yes, unfortunately that's the way it is now. So far (he says tempting fate) I've never had a real problem with them, but I have read some horror stories. That said, the last couple of times I've rung the phone has been answered in a few minutes.
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
Im going to get you to sort the Certificates of Residence etc out for me in future John as I have no end of problems with the muppets in the Corporation Tax department. One form they sent back without signing trying to claim its not their policy to sign it, but when I pointed out there own website link they then tried to say it was because I only sent two copies rather than three. The third copy was just a customer 'file' copy - so I pointed out I had a file copy (scanned from what I had sent them) and I would take another scanned copy once I got it back with their signature on, so I didnt need to weigh down the envelope I sent them by adding yet another copy. The idiots were still going on about that - was the only thing they could 'pick on' to try to push the blame on to me - four months later when they FINALLY sent me the signed form, even though there was a (sort of) apology letter. Now, no doubt, my client will have to pay CT in excess of what is due as his deadline is 1 March, and we have only just had the forms back from September of last year, whilst we now sort out the overpayment from abroad - unless that Tax office abroad is more efficient that ours. Oh hang on a mo - it might be do-able as you cannot get as bad as our lot!!!!!!!!!!! Oh and I have never ever had my call answered in just a few minutes! I wish!
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
