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Ask Your Own Question, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5116
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Hi there, I am trying to pay my taxes for 2013 - 2014. I

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Hi there,
I am trying to pay my taxes for 2013 - 2014. I have only just registered my business, but not have received the code I need to be able to pay my taxes.
I earnt £44,054 altogether and have £11,340 in expenses altogether. Minus tax break of 9440k, does that mean I’d only pay tax on £23,274?
Does it also mean I’d be in two classes of national insurance? If so, how much would that be for?
And can you pay tax back in installments?
Thanks so much!
Hello and welcome to the site. Thank you for your question.

Based on information provided, you will be taxed on £23,274 at 20% and your income tax payable will be £4,654.

As you are self employed you would also pay National insurance contributions, both Class 2 and Class 4, as follows:

Class 2 rate for 2013/14 is £2.70 pw i.e £140.40 for full tax year
Class 4 rate for 2013/14 is - first £7,755 per year at 0%
(32,714-7,755) £24,959 at 9% £2,246

So maximum NI payable is (140.40+2,246) £2,386.40
Income tax payable £4,654.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 3 years ago.

Thanks for your reply.

So I'd pay £2,386.40 and £4,654. So the total is £7040.40?

Would I have to pay anything else at all?

Sarah, thank you for your reply.

You should be paying your Class 2 NI on monthly direct debit. If this has not been setup, then you should contact National Insurance Contributions Unit and they would send you the relevant forms and also advise what you have to pay to date.

As far as Tax and Class 4 NI is concerned you should pay before 31 Jan 2015
Tax Year 2013-14 (4,654+2,246) = £6,900
Tax Year 2014-15 1st instalment (6,900/2) = £3,450

You will pay on 31 Jul 2015
Tax Year 2014-15 2nd instalment (6,900/2) = £3,450

Once you submit your tax return for year ended 5 Apr 2015 later this year, your tax payable for 2014-15 would be calculated and adjusted for two payments of £3,450 made on account in the absence of real figure.

I hope this is helpful and answers your question.

Customer: replied 3 years ago.

Thanks for your reply.

I am a little confused.

Am I forward paying based on an assumption that I would earn the same? What if this isn't the case?

And if I pay the second 2nd instalment (6,900/2) = £3,450 31 Jul 2015, then wouldn't that mean I'd paid all my tax before the deadline of next January? Why would this be so?



Sarah, thank you for your reply.

Under Self assessment you payment payments on account for current tax year albeit you don't actually know the liability. This is all put right once you file your tax return and final adjustment made on 31 Jan 2016. If you think you are have same level of income you can ask for your payments on account to be reduced.

This is explained here

I hope this is helpful. and other Tax Specialists are ready to help you
I thank you for accepting my answer.

Best wishes.