Self Employed NI Contributions
Self Employed NI Contributions
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Discussion

tim2100

Original Poster:

6,288 posts

288 months

Sunday 23rd November 2008
quotequote all
Help!

Started a business about 6 months ago. I have received a letter from HMRC for NI Contributions for self Employed.

Although the business runs 6 days per week, I am only working on it on weekends. The business is currently running at a loss and therefore I am not taking a penny out of it.

Why do I have to pay these? I also pay NI Contributions in my main weekday job. My job pays me approx the turnover of my business so I pay far my NI each month than they are asking.

If I explain this to them can i not pay these contributions? I have changed jobs since my business started up so they know that I am working.

Cheers
Tim.

amir_j

3,579 posts

232 months

Sunday 23rd November 2008
quotequote all
tim2100 said:
Help!

Started a business about 6 months ago. I have received a letter from HMRC for NI Contributions for self Employed.

Although the business runs 6 days per week, I am only working on it on weekends. The business is currently running at a loss and therefore I am not taking a penny out of it.

Why do I have to pay these? I also pay NI Contributions in my main weekday job. My job pays me approx the turnover of my business so I pay far my NI each month than they are asking.

If I explain this to them can i not pay these contributions? I have changed jobs since my business started up so they know that I am working.

Cheers
Tim.
Speak to your accountant, If no salary then should be no NI as its a deduction from gross pay.

Eric Mc

125,855 posts

296 months

Sunday 23rd November 2008
quotequote all
Sorry amir, slightly differnt rules for the self employed (although the end result might be the same).

If you are genuinely making a trading loss, you will therefore be well below the NI limit for Class 2 NI contributions (a net taxable profit of £4,825 for tax year 2008/09). In order to ensure the Revenue stops hassling you for Class 2 NI you need to write to them explaining that you are below this limit (called the Small Earnings Exception limit) for 2008/09.

tim2100

Original Poster:

6,288 posts

288 months

Sunday 23rd November 2008
quotequote all
Thanks Eric I will do that, is it worth trying over phone first?

Tim.

Eric Mc

125,855 posts

296 months

Monday 24th November 2008
quotequote all
tim2100 said:
Thanks Eric I will do that, is it worth trying over phone first?

Tim.
No harm in trying - although they may still ask you to complete and submit the formal application for exemption.