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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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Hi, I was in FTE for the majority of the 2012/2013 tax year

Customer Question

Hi,
I was in FTE for the majority of the 2012/2013 tax year (Taxed as PAYE) and performed a one-off contract with a company for £3,000. I failed to notify HMRC of any tax liability for the one-off contract, nor did I register as self-employed.

What sort of tax will I need to pay on this additional income and what is the best way to go about it?

Kind regards ***** ***** thanks,
Ver.
Submitted: 3 years ago.
Category: Tax
Expert:  bigduckontax replied 3 years ago.
Hello Ver, I'm Keith and happy to help you with your question.

Final tax returns for the tax year 13/14 are due by 31 October (paper) and 31 January 2015 (on line) so you have no problems there. If you have already made a self assessment return to HMRC then all you need to do is write to them to amend your return for your ore off contract. They will issue an amended notice to tell you the amount of additional tax and NI payable. If you have, like the majority of the population, not had to make a return you should write to your tax office and ask for a form to enable you to self assess.

You technically have notified HMRC of your intention to start self employment and you should do so anyway even if this contract is, at this stage, unique. I doubt if they will be particularly concerned providing the income is declared, especially if iut is an one off.

The level of tax and NI payable depends upon your existing PAYE position. Tax will have to be paid at 20% basic rate (up to 32010), 40% thereafter up to 150K and 45% above that. Incomes over 100K have the personal allowance reduced by two quid for every one earned over the 100K.

I do hope I have been able to help. At present this is a no panic situation, you are well within time for notification to HMRC.

Expert:  bigduckontax replied 3 years ago.
Sorry, I have mislead you, you must notify HMRC immediately of the position and may have to pay a penalty and also interest on outstanding unpaid tax.

Deep apologies, I misread your question. My answer still holds if you did not receive payment until the 13/14 tax year.

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