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tax threshold help

(2 Posts)
lunar1 Wed 06-Jan-16 14:08:37

I have just finished doing accounts for 14/15 and was planning to submit it today. The figure I've come out with of taxable pay is £100346!

How will this affect what I need to pay interns of tax and ni? The majority of it is paid work which has already been taxed at 40%. 15% of it is private work and not yet taxed.

Hope this is the right place to ask, I'm guessing I'm going to have to get an accountant sorted out! Have I fallen into a tax black hole?

Cindy34 Thu 07-Jan-16 06:29:39

Private work, you would be talking profit not turnover. So if you have business expenses, your profit would be lower than your turnover.

Income from PAYE is taken first in terms of personal tax allowance, so you will be paying tax on your own business profits at the highest tax rate. Personal allowance will reduce by £1 for every £2 above £100,000 total income, not quite sure how that works. Worse case, no personal allowance.

Higher rate tax band is for income between £31,786 up to £150,000 so you would be paying income tax at 40% on your private work. National insurance is done on a per job basis, so I think on your private work you would be looking at paying Class 2 and Class 4 national insurance.

Have you done your tax return for 2014/15 tax year? Enter in all your employment (using info from P60's) and then put in your business profits.

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