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self-employment/tax/benefit issues

(4 Posts)
behindthetimes Mon 17-Feb-14 16:08:37

Can anyone help me understand these issues? Sorry it's a long one but if you have the patience to trawl through and notice anything that I may be doing wrong I would be most grateful.
My husband is from abroad when he moved here started his own business. It went well, he works about 30 hours a week including driving time. He pays me as administrator which brings us under the tax threshold and we get working and child tax credits. Our resulting income is minimal but we are not on the breadline. We pay rent and bills, food and petrol and visit my husbands family overseas twice a year. We are not well off but in the current climate I feel quite fortunate. My husband is frustrated at our lack of savings, partly because, like many people from overseas, he believed that the UK was the place he would make his fortune hmm
Today he went for a meeting with some people who want him to work for them full time. They can only pay him 450 per month, and suggested he rent a house round the corner for 550 a month confused, as he would need to live very near to the place of work to carry out his duties. The position would not leave him enough time to carry on with his current work.
They told him that he would be better off working for them as he would probably get housing benefit, and that we should be getting housing benefit anyway. I have applied 3 times since we have been here and we seem to to over the threshold. They also said that while he wasn't paying tax at the moment, after a few years he would get a bill and probably have to pay about half of what he has earnt since he started. They said there was no point being self-epmployed to earn to little, it only works if you're earning 1000's every month. It sounds to me like these people don't have a clue what they are talking about, and DH and I have had a blazing 2 hour row grin. However, I find the whole self-employed/tax/benefits thing quite complex, and am worried I have overlooked something very important that's going to scupper us. It is me that works out all the tax/benefits stuff.
From my husbands point of view, he feels he works very hard (he does, despite the hours being less than full time, the work itself is very tiring) and isn't getting anywhere. I sympathise, but then most people we know are in a similar situation.
I'm not working at the moment but hope to be in a few months time.
Any advice gratefully received. The enboldened bit is the bit I'm most worried about.

TalkinPeace Mon 17-Feb-14 22:24:50

Have a read through the page I wrote for ebayers
as its a pretty good summary of UK tax and business law and approaches

450 a month full time is illegal ....
look up the National Minimum wage

and they are talking hogwash about income straddling tax years.

plug your numbers into the samples on my page
and you need to talk to a proper accountant because unless he is paying you properly through a PAYE scheme it could all go pear shaped

do you have an accountant ... it would almost certainly save you more than they charge

behindthetimes Tue 18-Feb-14 16:56:25

Thanks for your reply, I was beginning to give up hope! Yes, I'll have a look at your page once toddler is in bed. Yes we are well aware that 450 is fairly ridiculous. Though to be fair, he needs to be 'available' rather than actually working full time, but that would preclude him being able to do anything else so it's not going to work.
We don't have an accountant as it's all seemed quite straight forward so far, I just do the tax return each year, but you think an accountant may help us?
Also, can you say anymore about the PAYE issue? I was led to believe that what we are doing is above board, because the hours his pays me for fall under a certain amount.

TalkinPeace Tue 18-Feb-14 17:39:17

does he have a PAYE scheme number and pay you through a payslip and RTI filing?
Do you have payslips and a P60 or P38 ?
If not then you are not complying with PAYE

the £450 a month to be available sounds like a zero hours contract : nasty things

yes, an accountant would probably help you a lot : especially as you have not grown up with the UK tax system in al its glories!

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