Paye Coding Notice (s)
Discussion
I got sent 2 through the post, in the same envelope, this morning as well. One is 14T and the other is 732L. I'm similarly confused.
I currently have zero income and registered as self-employed last November in the hope/expectation of getting the 16 week self-employment credit of £50/week...which I didn't get. Total income for the whole of last year was less than £1000 - most of that was the 6 months job seekers allowance.
I've managed to get a temporary job starting 6 April for a month and was planning on going to the tax office to get a form (don't know which one) which would stop the temporary employer deducting tax and NI at source, since it's unlikely that I'll earn more than £2000 in the next tax year.
I'm guessing that they think I might get future full time employment, and the small other code is for my 'self-employed' position.
I currently have zero income and registered as self-employed last November in the hope/expectation of getting the 16 week self-employment credit of £50/week...which I didn't get. Total income for the whole of last year was less than £1000 - most of that was the 6 months job seekers allowance.
I've managed to get a temporary job starting 6 April for a month and was planning on going to the tax office to get a form (don't know which one) which would stop the temporary employer deducting tax and NI at source, since it's unlikely that I'll earn more than £2000 in the next tax year.
I'm guessing that they think I might get future full time employment, and the small other code is for my 'self-employed' position.
Mojocvh said:
Eric Mc said:
Do they relate to the same employment?
No Eric. One is ETC and the other is to allow forces pension to be taxed @ 20% I think ....
Edited by Mojocvh on Monday 21st March 17:49
The main thing is to ensure that teh combined PAYE being deducted is correct.
Edited by Eric Mc on Tuesday 22 March 09:09
condor said:
I got sent 2 through the post, in the same envelope, this morning as well. One is 14T and the other is 732L. I'm similarly confused.
I currently have zero income and registered as self-employed last November in the hope/expectation of getting the 16 week self-employment credit of £50/week...which I didn't get. Total income for the whole of last year was less than £1000 - most of that was the 6 months job seekers allowance.
I've managed to get a temporary job starting 6 April for a month and was planning on going to the tax office to get a form (don't know which one) which would stop the temporary employer deducting tax and NI at source, since it's unlikely that I'll earn more than £2000 in the next tax year.
I'm guessing that they think I might get future full time employment, and the small other code is for my 'self-employed' position.
It's amazing how poorly "lay people" understand how UK taxes work. It should be a compulsory subject in school.I currently have zero income and registered as self-employed last November in the hope/expectation of getting the 16 week self-employment credit of £50/week...which I didn't get. Total income for the whole of last year was less than £1000 - most of that was the 6 months job seekers allowance.
I've managed to get a temporary job starting 6 April for a month and was planning on going to the tax office to get a form (don't know which one) which would stop the temporary employer deducting tax and NI at source, since it's unlikely that I'll earn more than £2000 in the next tax year.
I'm guessing that they think I might get future full time employment, and the small other code is for my 'self-employed' position.
The purpose of PAYE codes is to allow EMPLOYERS or pension providers to calculate and deduct Income Tax from salaries and pensions on a weekly or monthly basis. Self Employed income NEVER has PAYE type codes allocated to it. You do not pay Income Tax on a weekly/monthly basis on self employed income so there is no reason to have PAYE codes allocated to that particular source.
Instead, the self employed individual completes a Self Assessment tax return after the end of the tax year on which they declare ALL their income (including any income from salaries or pensions) and their overall tax (and Class 4 NI) liabilities are calculated for the tax year. Any taxes already paid under PAYE will be taken into account and any taxes left to pay (normally taxes and Class 4 NI relating to the profits from the self employed activity) will be paid separately through the Self Assessment tax payment system.
If the self employed activity produces a loss, some of the tax paid under PAYE may be refunded.
If an employer or pension provider has deducted too much tax because of incorrect PAYE codes (not an unusual occurence), the completion of the Self Assessment tax return is a very good way of notifying HMRC of the correct situation and any over deducted taxes will be refunded.
I've just managed to obtain tax refunds of over £4,000 for one client who had been allocated incorrect PAYE codings for one of his pensions.
Eric Mc said:
That probably explains it then. Both sources of PAYE need to have separate codes allocated to them so that those who are paying you deduct the correct PAYE from the two sources.
The main thing is to ensure that teh combined PAYE being deducted is correct.
Thanks for that.The main thing is to ensure that teh combined PAYE being deducted is correct.
Edited by Eric Mc on Tuesday 22 March 09:09
Mo.
Thanks Eric for your comments - it made me feel a bit more clued up when I went to the tax office this afternoon.
At the tax office, I showed the 2 different PAYE codes and told them I've been registered self-employed since November and they just told me to ignore the PAYE codes. Since I'm doing a 4 week temp job next month, I'll have to fill in a P46, pay tax and NI - but can then claim the tax back, but as I understood it, not the NI.
At the tax office, I showed the 2 different PAYE codes and told them I've been registered self-employed since November and they just told me to ignore the PAYE codes. Since I'm doing a 4 week temp job next month, I'll have to fill in a P46, pay tax and NI - but can then claim the tax back, but as I understood it, not the NI.
condor said:
Thanks Eric for your comments - it made me feel a bit more clued up when I went to the tax office this afternoon.
At the tax office, I showed the 2 different PAYE codes and told them I've been registered self-employed since November and they just told me to ignore the PAYE codes. Since I'm doing a 4 week temp job next month, I'll have to fill in a P46, pay tax and NI - but can then claim the tax back, but as I understood it, not the NI.
The problem with these "cunning plans" is when you run into an AO who hasn't heard of them!At the tax office, I showed the 2 different PAYE codes and told them I've been registered self-employed since November and they just told me to ignore the PAYE codes. Since I'm doing a 4 week temp job next month, I'll have to fill in a P46, pay tax and NI - but can then claim the tax back, but as I understood it, not the NI.
cheers
Mo.
Admin Officer?
NI is calculated on a job by job basis so, if you are liable to pay NI ina a particular job, you pay it. You start paying Class 1 NI in an employment when your weekly gross salary exceeds the Lower Earnings Limit which is currently £110.
If your gross salary falls below that, you don't pay any NI IN THAT JOB.
NI is calculated on a job by job basis so, if you are liable to pay NI ina a particular job, you pay it. You start paying Class 1 NI in an employment when your weekly gross salary exceeds the Lower Earnings Limit which is currently £110.
If your gross salary falls below that, you don't pay any NI IN THAT JOB.
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