Coronavirus has ruined all my plans

[Corkiecova]

I am long-term disabled not worked for over 10 years. After a radical treatment last year I had hoped to return to work, self employed at home (all I could do) and was working towards that.

Now the chancellor has announced that with the new package for the self employed contributions for the self employed will equalize and as a result I will never be able to do this as I won't be able to afford my contributions meaning Ill never work again at all most likely. I'm only 42 and my life is over. Trapped on benefits with nothing, forever. My dreams were all that kept me going and now its over for me.

I do know I am being unreasonable but this is the end for me, no point anymore.

[MarginalGain]

He only just announced this minutes ago, maybe wait for a more comprehensive analysis?

I'm sure it's not as bad as it seems.

[Lweji]

Things change.
They have changed for worse now, but they will change again, hopefully for better.
Don't think that it's definitive.

[flapjackfairy]

I dont understand the point? Sorry how does it stop you working from home ?
Surely he was merely saying after this is all over the situation needs to be looked at overall so we can get back on our feet ! We will all have to pay more taxes I would imagine when the dust settles !

[flapjackfairy]

And don't despair. Keep working towards a better future x

[Corkiecova]

I think it will be bad and not just for me. Many will be unable to be self employed or hold down a normal job and will end up on disability benefits as a result. The government wanted to do it previously but scrapped it as it was too complex but now its clearly back on the table. I know its a tough time for all but I'm just so sad.

[Corkiecova]

I think its about tje NI contribution bands. Tax is fine as that is on what you actually earn.

[Corkiecova]

How do I turn the vote off i didnt want that

[BritWifeinUSA]

Have you considered working from home for a company? Many companies offer home working jobs in customer service, etc, answering emails or processing orders... Now might not be the best time to look for a job but in a few months you could start your search. It appears that you can use a computer to type responses to people’s questions (that’s what you’ve been doing on this thread) so why not see if you can get paid for it?

[Zilla1]

If you are based in the UK then I think you might be reaching, OP. He put a hook in that means HMRC will presumably have a further go at the perceived inequalities of 'disguised employment (NI employer's contributions, for example) but you only need to look at their actions around IR35 and perceived disguised employment to realise that is has been a long-term objective for this government (in some ways politically odd for a conservative government but deficits need paying I suppose in their world view). If you have plans to earn money then I don't think the Chancellor's statement should be read as certain or likely to make a viable scheme/business unviable. The effects of COVID on the economy might be a different beast but not that phrase in the Chancellor's announcements today. Carry on preparing and building your business. Self-employed or employed and running a 'personal' company in almost all cases (aside from the circumstances arising from pension contributions if earning over £100/£150k meaning marginal tax rates can exceed 100%) won't lead to marginal taxes making working and earning not worth it (double negative I know).

good luck in your venture.

[WitchDancer]

I'm sorry, but that's like saying I'm not going to earn £1,000 because I'm going to end up paying tax of £200. You would still earn £800, so why wouldn't you go for it?

[Zilla1]

It's about the NI contribution bands? what do you mean, OP?

[Corkiecova]

But if they make the NI contributions to high I'll never be able to even start! I know some people take the micky with hobby businesses but I wouldnt be applying for UC but I probably would make much money ever. But it would give me some dignity and my life some purpose. If I'm likey to lose any pension because of trying to do this then I'm stuck. I have no private pension, nothing but my stamp. If I lose that Ill have nothing.

[DogInATent]

We don't know what he's going to propose in the future, so it's far too early to get upset or frustrated.

NI is income related for both employed and self-employed, I don't see that changing - only the percentages.

[Corkiecova]

I can't work for another company unless they accept that I have to do my own hours and cant meet their targets. Ive looked into it in the past and it wasn't viable.

[Corkiecova]

The last time they proposed the NI changes it was too much and wouldn't allowed me to start. I think a lot of people would be in the same boat especially disabled people.

[Corkiecova]

@zilla1 thanks you have calmed me down a bit.

[Zilla1]

In the UK, as an employee:
Income Tax -
you pay 0% on earnings up to £12,500* for 2019-20
then you pay 20% on anything you earn between £12,501 and £50,000
you’ll pay 40% Income Tax on earnings between £50,001 to £150,000
if you earn £150,001 and over you pay 45% tax.

As an employee:
National Insurance -
you pay National Insurance contributions if you earn more than £166 a week (£183 2020-21)
you pay 12% of your earnings above this limit and up to £962 a week (for 2019-20 £183-£962 2020-21)
the rate drops to 2% of your earnings over £962 a week.
For example, if you earn £1,000 a week, you pay:

nothing on the first £166
12% (£95.52) on the next £796
2% (£0.76) on the next £38.

Now HMT have a bee in their bonnet about limited companies (so-called 'personal services companies') avoiding employer's NI through disguised employment and have set in place various arrangements (IR35 and disguised employment tests) but you'll see from those figures above, OP, that those rates of NI and tax are payable on marginal earnings. Even if the Chancellor puts in place arrangements to stop any avoidance of employer's NI through disguised employment, how would this mean your plans to work from home aren't viable?

[abeautifulmess1234]

You need to try and calm down, panicking isn't going to help your anxiety. This isn't going to last forever and you are definitely not the only person worrying about the future. Limit the amount of time that you watch or listen to the news and see how things are in a few weeks/months time.

[WitchDancer]

Class 4 NI contributions are on a sliding scale though, based on what you earn, which currently stands at 9% after you hit the threshold. The only one that is a fixed amount is the class 2, which has a threshold before it kicks in anyway.

[DogInATent]

There's a threshold, below which you pay no NI. I don't see that changing.

Above that you pay Class 2 either monthly/quarterly and when you do your self-assessment you top that up with Class 4 which is income related. They're likely to bump the Class 4 contribution and those that will see their contribution increasing the most are those that would be earning the most.

How much do you think you would be able to earn through this business?

[flossyflorenceflounces]

You are 42, your life isn't over - there will be a way to make a fulfilling life for you, it'll just take time to work out what it is. Now is a difficult time and it's hard to make plans for the future but it will work out in the end.

[Zilla1]

You're welcome, OP, and try not to worry, the Chancellor might but everyone's income tax and/or NI rates up a % but his statement today had a hook about disguised employment, not the NI and Income Tax you'd pay. So if you earn up to £50k, you'll still keep around/more than two-thirds of the money you earn after tax and NI (More as this is the marginal rate and the allowances mean the first part of that would be 'tax and NI-free'.

Good luck in your venture. Within mums net rules, post what you make/do or keep everyone updated with your success or allow everyone to buy if it's crafts).

[Bubblebu]

It is because IR35 no longer works for anyone. Not OP's fault.

[WitchDancer]

DogInATent - Class 2 is paid annually with any tax liability and has been for some time now, not monthly/quarterly.

[Teacher12345]

I think you will find it has ruined many many plans. DH and I took 60k of loans out to starrt up a business in the leisure industry that now cannot trade.
Its a fucking nightmare. Do some research and prepare for when you can.