Tax return time!

[Jon]

Just realised this will be my 11th SA Time flies!

wow 11 years. I think i'm around 7/8 years without looking!

 

[ASAP]

Hello, I'm a newbie here. I have a query with regards to whether I need to register for self assessment with HMRC and declare income on a tax return.

Basically, I have a part time job at the moment, but on top of that I'm thinking of signing up to a few mystery shopping websites to earn a bit of extra income. I'm not sure if I need to register for self assessment based on what I've read on this webpage from HMRC https://www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income

It sounds a bit confusing and I don't want to end up getting fined for not following the rules.

On the HMRC webpage it says you get a trading allowance of £1000, so if you earn less than £1000 for casual jobs like mystery shopping etc. then you don't need to declare it or register for self assessment? Am I right? I doubt I would be earning more than £1000 doing mystery shopping.

With my part time job, I'm not really earning much, in fact I don't pay tax because the amount I earn comes within the personal tax allowance. However, on the HMRC webpage it says that I must tell HMRC if:

• gross trading income over £1,000 - register for Self Assessment
• other gross income over £1,000 up to £2,500 - contact HMRC
• other income over £2,500 - register for Self Assessment

Does the income I get from my part time job count under 'other income'? In which case, it would seem like I would need to register for self assessment because my earnings from my part time job is over £1000-£2500? They don't seem to make it clear, or perhaps I'm not reading it properly. Anyhow, if anyone here can clarify this, it would be much appreciated!

 

[Jon]

Hello, I'm a newbie here. I have a query with regards to whether I need to register for self assessment with HMRC and declare income on a tax return.

Basically, I have a part time job at the moment, but on top of that I'm thinking of signing up to a few mystery shopping websites to earn a bit of extra income. I'm not sure if I need to register for self assessment based on what I've read on this webpage from HMRC https://www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income

It sounds a bit confusing and I don't want to end up getting fined for not following the rules.

On the HMRC webpage it says you get a trading allowance of £1000, so if you earn less than £1000 for casual jobs like mystery shopping etc. then you don't need to declare it or register for self assessment? Am I right? I doubt I would be earning more than £1000 doing mystery shopping.

With my part time job, I'm not really earning much, in fact I don't pay tax because the amount I earn comes within the personal tax allowance. However, on the HMRC webpage it says that I must tell HMRC if:

• gross trading income over £1,000 - register for Self Assessment
• other gross income over £1,000 up to £2,500 - contact HMRC
• other income over £2,500 - register for Self Assessment

Does the income I get from my part time job count under 'other income'? In which case, it would seem like I would need to register for self assessment because my earnings from my part time job is over £1000-£2500? They don't seem to make it clear, or perhaps I'm not reading it properly. Anyhow, if anyone here can clarify this, it would be much appreciated!

Yup you've got it right

If you earn less than £1000 self employed then you don't need to pay any tax

 

[Queen Jess]

Hello, I'm a newbie here. I have a query with regards to whether I need to register for self assessment with HMRC and declare income on a tax return.

Basically, I have a part time job at the moment, but on top of that I'm thinking of signing up to a few mystery shopping websites to earn a bit of extra income. I'm not sure if I need to register for self assessment based on what I've read on this webpage from HMRC https://www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income

It sounds a bit confusing and I don't want to end up getting fined for not following the rules.

On the HMRC webpage it says you get a trading allowance of £1000, so if you earn less than £1000 for casual jobs like mystery shopping etc. then you don't need to declare it or register for self assessment? Am I right? I doubt I would be earning more than £1000 doing mystery shopping.

With my part time job, I'm not really earning much, in fact I don't pay tax because the amount I earn comes within the personal tax allowance. However, on the HMRC webpage it says that I must tell HMRC if:

• gross trading income over £1,000 - register for Self Assessment
• other gross income over £1,000 up to £2,500 - contact HMRC
• other income over £2,500 - register for Self Assessment

Does the income I get from my part time job count under 'other income'? In which case, it would seem like I would need to register for self assessment because my earnings from my part time job is over £1000-£2500? They don't seem to make it clear, or perhaps I'm not reading it properly. Anyhow, if anyone here can clarify this, it would be much appreciated!

Yep Jon is correct, you don't have to declare it if it's below £1,000 in the year. Just to answer your other question, you part time pay is employment income and not other income. Other income relates to commissions and stuff NOT related to employment or part time employment (ie normal) income.

 

[ASAP]

Yup you've got it right

If you earn less than £1000 self employed then you don't need to pay any tax

Yep Jon is correct, you don't have to declare it if it's below £1,000 in the year. Just to answer your other question, you part time pay is employment income and not other income. Other income relates to commissions and stuff NOT related to employment or part time employment (ie normal) income.

Thanks for the advice!

Do I still need to register for self assessment despite not having to declare my self-employed earnings?

I'm also in the process of looking for a full time job. So say if I were to get a full time job with a salary of around 15k, this would mean that I would have used up my personal tax allowance for the tax year, so would I then need to declare my self employed earnings (which is less than £1000)?

 

[Queen Jess]

Thanks for the advice!

Do I still need to register for self assessment despite not having to declare my self-employed earnings?

I'm also in the process of looking for a full time job. So say if I were to get a full time job with a salary of around 15k, this would mean that I would have used up my personal tax allowance for the tax year, so would I then need to declare my self employed earnings (which is less than £1000)?

Nope you don't have to declare it if it's below £1,000. Nor do you have to do anything if you get a full time job rather than just a part time one. The great thing about normal employment income is that your company payroll figures out your payroll taxes to pay, reports it to HMRC and makes sure it is paid. It will come out of your pay automatically and be shown on your payslip each month. It means no faffing around with tax forms for you unless you get other incomes.

 

[homie]

Thanks for the advice!

Do I still need to register for self assessment despite not having to declare my self-employed earnings?

I'm also in the process of looking for a full time job. So say if I were to get a full time job with a salary of around 15k, this would mean that I would have used up my personal tax allowance for the tax year, so would I then need to declare my self employed earnings (which is less than £1000)?

Bottom line is as long as your untaxed earnings outside of regular employment are below £1000 then you don't need to register or pay tax on it. Don't register for self assessment unless you have to as it will just make unnecessary extra work for you.

Be aware though, once you get stuck into earning online £1000 is quite easy to churn through and you might find you reach that limit faster than you think. (which is a good thing of course) ((also note any income through betting is always tax free no matter how much you earn))

 

[ASAP]

Thanks for the really helpful advice!

I've noticed that the mystery shopping websites have an agreement box that you have to tick which says that by ticking the box, you agree that you're self-employed and that it is your responsibility to declare you earnings to the HMRC.

When it comes to earnings from doing mystery shopping, do the reimbursement I get for purchasing a product from a shop as part of the job assignment count as earnings?

How much tax would someone need to pay if they earn over the £1000 trade allowance?

 

[Queen Jess]

On reimbursements I am not 100% sure, but I believe you do have to declare them since you got to keep the product and therefore got a benefit.

Relating to paying tax, this would just be added to your normal personal tax calculation. So assuming nothing else to consider, if you earn £10,000 full time job and £5,000 mystery shopping, you will have a total of £15,000 to be assessed for tax.

Current tax bands are 0% between £11,850 (personal allowance), 20% Basic to £46,350 etc. So on £15,000 you will have used all your personal allowance and then the remaining £3,150 will be charged at 20% (i.e. tax of £630 to pay).

So basically you will probably be paying 20% tax on these earnings after you have used up your personal allowance.

 

[Queen Jess]

So just for light relief... My dad told me that nothing ever changed on my grandad's return and he used to send the form back each year just with "same as last year" written at the top without anything else filled in. They never questioned it!

Those were the good old days!

 

[Jon]

Just a warning

I've been getting a lot of these Spam emails in my mailbox recently

Obviously, it's utter bollocks but keep ya eye out!

 

[taffynoel]

I called HMRC today as I was advised you need to get your tax code changes to account for casual earnings under £1000

 

[homie]

If you're earning under £1000 and most of that is going into paypal then I really wouldn't tell them anything.Otherwise it just muddies the water for no reason.

 

[Queen Jess]

You

I called HMRC today as I was advised you need to get your tax code changes to account for casual earnings under £1000

You shouldn't have to do that - the limit is actually there because many more people are earnings bits and pieces on the side these days and it isn't worth HMRCs time and effort for such tiny amounts. See: https://www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income#cant

If you earn above £1,000 then you can either get HMRC to adjust your tax rate each month to try and account for it during the year or you can just pay it all at the end of the year once you fill in a tax return.

 

[ASAP]

If you're earning under £1000 and most of that is going into paypal then I really wouldn't tell them anything.Otherwise it just muddies the water for no reason.

What if it's paid into a bank account? Is there an advantage in having the money paid into a paypal account and keeping a separate account for casual earnings (mystery shopping) and earnings from a paid full-time/part-time job?

 

[Ginnybean]

What if it's paid into a bank account? Is there an advantage in having the money paid into a paypal account and keeping a separate account for casual earnings (mystery shopping) and earnings from a paid full-time/part-time job?

It doesn't make any difference where you receive or keep the income. It is the amount that matters. If you have over £1000 of income you need pay tax and probably register self-employed with HMRC too.

 

[Queen Jess]

It doesn't make any difference where you receive or keep the income. It is the amount that matters. If you have over £1000 of income you need pay tax and probably register self-employed with HMRC too.

Yep agreed. If you do need to register then always do it sooner rather than later as it takes ages to get set up in the tax return system (especially if like me you forget to log in when you get your login details, realise there is an end date for the details you have been sent and have to wait another 2 weeks for HMRC to send you new login details....oops!).

 

[saffi420]

Hello. I filled in my tax return today and it only included an occupational pension and savings interest as I had done no self employed jobs for the whole of the tax year due to bereavement.

I checked a box that said "were my incomings from self employment less than £1,000" and then in the final declaration they listed that I was not an employee (true), that I received no state pensions (true) and that I'm not self-employed, but this is untrue as I registered self employed in 2015. Is this something to do with the below earnings if £1,000 or have I made an error? I went back to look through my inputs but it still comes up with the same.

I know this sounds as clear as mud, but I just wondered if anyone had any thoughts? I'd be pleased to listen. It would be great to have an idea of what I'm asking before I ring SA as I know they'll simply baffle me with science!!

Thanks in advance.

 

[Jon]

Hello. I filled in my tax return today and it only included an occupational pension and savings interest as I had done no self employed jobs for the whole of the tax year due to bereavement.

I checked a box that said "were my incomings from self employment less than £1,000" and then in the final declaration they listed that I was not an employee (true), that I received no state pensions (true) and that I'm not self-employed, but this is untrue as I registered self employed in 2015. Is this something to do with the below earnings if £1,000 or have I made an error? I went back to look through my inputs but it still comes up with the same.

I know this sounds as clear as mud, but I just wondered if anyone had any thoughts? I'd be pleased to listen. It would be great to have an idea of what I'm asking before I ring SA as I know they'll simply baffle me with science!!

Thanks in advance.

I would imagine it’s becusse your earnings are under £1000 and so are seen as “private earnings” if that makes sense

I would just ring them and ask them if that’s the reason why it says you are not self employed.

I’ve always found them helpful (at least over live chat!) as I’ve had my own battles with them recently!

 

[saffi420]

I would imagine it’s becusse your earnings are under £1000 and so are seen as “private earnings” if that makes sense

I would just ring them and ask them if that’s the reason why it says you are not self employed.

I’ve always found them helpful (at least over live chat!) as I’ve had my own battles with them recently!

Many thanks for taking time to reply, yes, that makes good sense.