Self employed second job

[The Family Cyclist]

Like everyone finding the money doesn't go as far at the moment

Considering some extra evening/weekend work and found a local farm which I'd actually enjoy. However the pay is as self employed. I'm currently employed by a company and wonder how it would work also being self employed

Obviously would be taxed as past the NI/tax threshold but at no risk of going into the higher rate

[robgul]

Chances are you'd need to complete a Self Assessment Form (after the end of the tax year) to account for the income (which I assume will be paid without deductions) - the form calculates what you need to pay in tax etc.

.... in the back of my mind I think there is a modest amount of "other income" that you can earn, as an employee, without having to pay tax on it - worth checking on that as SA is a PITA.

[Pedal Castro]

It's £1000pa, which if your extra income is greater than that you'll need to do the self assessment but can claim the £1000 tax as an extra free allowance.

[robgul]

It's £1000pa, which if your extra income is greater than that you'll need to do the self assessment but can claim the £1000 tax as an extra free allowance.

Ah - I thought it was a grand - thanks for confirming.

[citoyen]

Chances are you'd need to complete a Self Assessment Form (after the end of the tax year) to account for the income (which I assume will be paid without deductions) - the form calculates what you need to pay in tax etc.

^This.

SA is no great hardship - should be very straightforward for the circumstances described. All you have to do is call HMRC to register for SA, and they'll send you the form at the end of the tax year. (Shouldn't be any need to tell your main employer though, as long as there's no conflict of interest.)

You'll just have to fill in one page with the numbers off the P60 from your main employer.

And on another page, you'll fill in the total income from the second job less any allowable expenses.

HMRC will then tell you how much you owe. Which might not be much at all, but it's probably worth putting aside around a third of your self-employed income for this purpose.

You might also need to register for Class 2 NI - I had to pay a regular weekly amount towards this when I was freelance, but that's because self-employment was my main income and the amount I paid was based on previous years' tax returns. You might get away with just paying a lump sum at the end of the year, which will be rolled into your tax bill.

[BFC]

NI contributions are assessed for each employment independently, with Lower Earnings Limit and Earnings Threshold (in the PAYE system anyway) .

Income tax in incremental.

one method of earning maximisation I know of from news (many years ago) was the owner of a few pubs employing a cleaner under separate contracts for each pub - each employment was below the NI thresholds (also avoided the employer paying NI contributions!).

[The Family Cyclist]

Thanks everyone.

[Paul H]

Yes, you have a £1,000 a year tax free Trading Allowance, you can claim that or your business expenses but not both. 
What farm work gets classed as self-employed?  I thought the criteria on what was and wasn't employment were tightened up years ago.

[citoyen]

NI contributions are assessed for each employment independently, with Lower Earnings Limit and Earnings Threshold (in the PAYE system anyway) .

If you’re in employment and earn over the threshold, you’ll pay Class 1 NI through PAYE.

For self-employed income, you pay Class 2 and Class 4 NI, which have different thresholds.

Class 2 is paid weekly throughout the year at a fixed rate, Class 4 is collected at the end of the year in your overall tax bill (if you earn over the threshold).

[aidan.f]

Online self assessment is the easiest method...once you have gone through the security hoops to register

[Paul H]

Class 2 is paid weekly throughout the year at a fixed rate, Class 4 is collected at the end of the year in your overall tax bill (if you earn over the threshold).

I pay both Class 2 & 4 yearly, via the online self assessment process, which as Aidan says is easy once set up.  Even easier if you're allowed to do cash accounting, which I think is an option for anyone with a small business.

[citoyen]

Doing it online is the only sensible option.

Cash accounting will be fine for the OP’s circumstances. It really should all be very straightforward.

[giropaul]

I hesitated to reply because I don’t want to appear negative. However, there are a couple of things I’d want to get clear if it was me.
In agricultural terms what you are doing would most likely be seen as “ casual labour “. For that the expectation would be that the employer would deduct tax and NI.
IR35 HMRC regulations would expect a self employed person to have other clients for the self employed business ( as a sole trader) . Easily done by taking on a bit of work, say gardening locally.
If it was me, I’d also want to check my own liability insurance, as well as my own accident insurance. As a self- employed person you might be expected to have your own accreditation for some jobs, like spraying and using some machinery.
I hope this is all easily sorted out with the farmer, is it a friend?
I may of course have read this wrong. It may be that you’re doing his book work or similar. In that case I guess that HMRC would understand that you’re building a new business, with one client to start with, but that you decide some aspects of the work, such as the times, or location.

PS I’ve been involved in farming most of my life, and I was self- employed ( in another type of work), for over 20 years.
It’s not unknown of course for farmers ( and other businesses) to “ employ” people “ off the books” . I guess it depends how risk averse you are.

[chrisbainbridge]

If it was me, I’d also want to check my own liability insurance, as well as my own accident insurance. As a self- employed person you might be expected to have your own accreditation for some jobs, like spraying and using some machinery.

If I was in charge of the country I would make all self employed people take out accident insurance on their first day.  I have spent the last 40 years of my life looking at people who were just doing a small job when something goes wrong and they are looking at months if not years of not working or reduced working capacity.  It is not always possible to sue the employer, if it is your mistake so you end up on benefits with a family on the way or to support.  I almost cry each time.

[citoyen]

I’ve signed up for personal accident cover for my new job, even though it’s desk-based.