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TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15946
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Hi, I have been offered a job one hour a day seven days a

Resolved Question:

Hi,
I have been offered a job one hour a day seven days a week 52 weeks a year caring for an elderly gentleman. It is the only home that I will work in. Do I pay my income tax or does the gentleman? I'm not sure if i am employed or unemployed?
Submitted: 3 years ago.
Category: Tax
Expert:  TonyTax replied 3 years ago.
Hi.

Can you tell me how much you will earn and whether you have any other income please.
Customer: replied 3 years ago.

I am a pensioner myself. This is my only job offer. I won't be taking


another job, this is a friend.


 


I have to pay tax on all earnings as I have £12,000 a year income from pensions.


 


I need to know if I would be employed or self employed before I accept this job. Also whether I pay tax on this income or the elderly gentleman.

Expert:  TonyTax replied 3 years ago.
Thanks.

Leave this with me while I draft my answer.
Customer: replied 3 years ago.

My salary would be £10 a day, £70 per week. If he would be paying my tax it will be worth my while but if i have to pay tax for myself I would not accept the job.


I'm not sure if he would be my employer or if this would make me self employed. I would be working at a regular specified time in his home providing personal care.

Expert:  TonyTax replied 3 years ago.

Hi again.

Strictly, you will be an employee of your elderly friend as you will read here under the question "I have been given a job by a lady to look after her mother. She insists that I have self-employed status. Am I an employee or self-employed?".

If you are employed, your employer should operate a PAYE scheme which he will need to get set up with the tax office here. I suspect that he will be reluctant to do that and will ask you to run the payroll for him. Many people in your position would act as a self-employed carer, register as self-employed here and pay the tax and national insurance contributions (no NIC for you if you are over 65) themselves by completing a self-assessment tax return at the end of each tax year.

If you work as an employee, your employer will deduct tax of £14 (20%) from the £70 weekly assuming that he doesn't want to pay out more than £70 per week in total. There would be no employer NIC at that level of pay. To leave you with net pay of £70 per week, he would have to pay you £87.50 per week and deduct £17.50 in tax. If you were self-employed and he paid you £70 per week, you would have to pay tax on that of £14.00 (20%).

I hope this helps but let me know if you have any further questions.

Customer: replied 3 years ago.

Thank you. I was asked by his daughter to care for her father. She will take the money from his pension . Is she my employer or the elderly gentleman. If so , should she pay me the extra money for me to organise my own tax or should she pay my tax as any employer would?

Expert:  TonyTax replied 3 years ago.
It seems to me that as your friend will be paying you, he will be your employer. It would be different if his daughter was paying you from her own resources.

You will need to negotiate your pay with your friend's daughter. If she or her father don't want to administer a payroll and you have to do it then you might ask for more money to carry out what is an employer's responsibility.
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