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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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This is Sam Tax- I am currently an NHS employee paying

Customer Question

This is for CIS Sam Tax-
I am currently an NHS employee paying the highest band of tax.
I earn the occasional £100 through speaker meetings.This goes into my mortgage account please could you let me know whether this is legally ok,if not what other options do I have ,is it worth setting up a ltd company instead?
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.
Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question. There is no problem with you placing your speaker fees into your mortgage account, but you must still declare them for tax on your annual self assessment tax return as they are actually income. You can reduce your tax bill by investing in a private pension or topping up your NHS pension by means of additional contributions if you are in that scheme. There is a limit to contributions, employee and employer's must not exceed 40K. You could set up a SIPP and mop up the last three years unused contribution levels. Setting up a company is easy enough relatively cheap. Corporation Tax will be at 20%. Remember that if you are a director you are an employee per se and any distribution of company income by way of emoluments must be made under PAYE arrangements. You could pay your spouse though; if she does not work then up to 10.6K [Personal Allowance] could escape tax in this way. I do hope that I have given you some food for thought. You may wish to follow up.
Customer: replied 1 year ago.
Ok to be honest I haven't declared the income as ( perhaps wrongly) I was told if it went into debt it wasn't an income as such, hence my question today as I shall be preparing my tax returns for the year shortly .
So ,is it ok to set up a ltd company with my spouse ( also nhs employee )?
And what would your advice be for this undeclared income ?
Tx
Expert:  bigduckontax replied 1 year ago.
You earned it so it would be classed as income irrespective of what you did with it and it must be declared. You should do so without delay, use the big box at the end to ask to amend prior years returns to take account of these fees. HMRC may impose penalties and charge tax and interest on the account. Penalties you may avoid by being honest.
As for setting up a limited company no problem whatsoever, but if your spouse is a director also watch out for the way in which payments must be made. I worked for the Government at one time and also had a couple of limited companies, no problems there.
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Customer: replied 1 year ago.
Ok thanks for your advice, you have been really helpful.One last querie:
Do I declare for all the years I have not filed the income or just the past five?
Expert:  bigduckontax replied 1 year ago.
All the years. HMRC might get a bit shirty though!
bigduckontax and other Tax Specialists are ready to help you
Expert:  bigduckontax replied 1 year ago.
Thank you for your support.

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