self employed - what financial help for childcare?

[zumm]

Hello, both my husband and I work for ourselves. He earns maybe £40k/year and I'm currently earning around £6k.

Part of the reason my income is so low is I am full time caring for our almost two year old DD.

Come September (when DD will be 2.4yrs) I would very much like to start using a part time nanny to allow me to do more work - she is fully registered so I would pay tax. She tells me that I & my OH are both entitled to something like £250/month in child care vouchers, which we can collect from our offices. And apparently this is not income-related. All this surprises me greatly.

Obviously, we don't have offices - so my question is: what, if any, support is there for self-employed people, and does anyone have any advice on how to claim it?

Thanks very much!

zumm if you're self-employed you should be registered for NI and paying class 2 of a flat weekly rate, currently £2.50 (often by 4 weekly direct debit but you'll get sent a demand in the post if not). When profits are between £7225 - £42,475 you pay Class 4 at 9% anything over this bracket is 2%. This however is collected with your tax on account and so you can't 'miss' paying this.

If you earn below 5315 (2011/12) then you can apply for an exemption from NICO, but I think from what you say this is not the case.

Check that you have registered as a penalty may be charged if you have not registered by 31 January after the end of the tax year in which they become due. ... you can call HMRC self-employed registration helpline

cross post and with 2012/13 rates a bit more up to date :)

Cross post? You were writing that for 23 hours? Perhaps you could have got it a bit more accurate then

class 2 of a flat weekly rate, currently £2.50
It is true that it was £2.50pw last week, but it goes up to £2.65 from this Friday so I think it is more helpful to quote that rate.

(often by 4 weekly direct debit but you'll get sent a demand in the post if not).
Class 2 NI is now paid 6 monthly in arrears, it hasn't been monthly for a year now.

If you earn below 5315 (2011/12) then you can apply for an exemption from NICO
You can, but for most self employed women this is a bad idea.

OK sorry just glanced at the time last night which is very similar ! ! ! and FWIW i wouldn't have bothered to post if I'd seen what you had written, I feel no particular need to make my voice heard/repeat information.

... I was just avoiding squeezing in some work and was very quickly trying to help someone out.

No need for sarcasm or to be a pedant Mr A

BTW Mr Anchovy for pedants corner with reference to payment of NI.

Class 2 NI is now paid 6 monthly in arrears, it hasn't been monthly for a year now.

As you might say. Not correct. HMRC have this to say:

Once registered, you can choose to make your payments either monthly or 6 monthly by Direct Debit.

But don't worry we can all may little mistakes

Yeahyeah and Mr A - cheers very much. I love pedants and I love people who understand money. Thank you both.

So, I called up the IR and as you both say if I earn over that 5kish threshold, I need to make sure I'm registered for NI (and back pay this from the end of my maternity leave).

If I earn under 5ish k then my child benefit means I am exempt from paying NICs BUT that I will apparently get MA sd I have a second child.

I also discovered I am no longer down as self-employed (I became PAYE in 2008 but, since I kept up my tax returns for extra free lance work, I thought I had maintained my self-emp status). So they are now reg'g me for NIC and sending me a CF10 exemption form - in case I earnt under the 5ish K (which may in fact be the case since tho I worked a fair bit last tax year, I'll only see the royalties this year).

Oh gawd. I SO need an accoutant - I believe people who earn royalties sd do some sort of balancing thing on the tax return, but clueless about that too. Dear pedants any ideas please?

Mr A, I also think your idea of teaming up with my DH is a very good one from a tax etc pt of view. I'm not sure he is convinced however. HE TOO needs a (better) accountant. I fear we are throwing money away through a simple lack of knowledge.

Thanks again. I am very pleased to have had your feedback!

If I earn under 5ish k then my child benefit means I am exempt from paying NICs BUT that I will apparently get MA sd I have a second child.

This is not correct. Child benefit does not affect your liability for NI or eligability for MA in any way.

So they are now reg'g me for NIC and sending me a CF10 exemption form - in case I earnt under the 5ish K (which may in fact be the case since tho I worked a fair bit last tax year, I'll only see the royalties this year).

DO NOT FILL IN THE EXEMPTION FORM. If you do you will not get MA - see here. A year's Class 2 NI will cost you £138, a week's MA is £128 so if there is any chance of having another child, don't claim the exemption.

I didn't realise that you were talking about royalties - if your income is solely or mainly from royalties you may not actually be self employed. It is details like this that make advice given on a forum useless really - you need to sit down with an accountant who can spend half an hour talking through what you and your DH actually do, your family circumstances etc. so that you can get advice that is optimal for you rather than just infomation extracted from the tens of thousands of pages of potentially relevant material.

Oh blimey. Mr A, this is serious stuff: those two pieces of advice came direct from the IR helpline. Hum.
He insisted that there was no point paying NICs if my income was less than c.5k since then I wld simply be 'paying' NICs twice (given that they are "covered by child benefit already for those on less than the c.£5k cut off" - at least according to him).
Yes, I need to sit down with an accountant.
Thank you for all your kind help to date!

The general helplines are staffed by people who don't know what they are talking about, they are just following a script like most call centres these days. However this guy has obviously started making things up for himself - think about it, if what he said was true everyone would be able to claim 39 weeks of MA for a second child!

You can usually get a bit more sense from the specialist helplines, try calling the Newly Self Employed helpline (open till 8pm and Saturday mornings) on 0845 915 4515.

MrA, I also wondered about this - but then I thought: surely if all it took were £138 in NICs per year then surely everyone ought to do this too?
He said I'd be double paying and that all I'd need to do wld be to go to the job centre to pick up some form if I wanted MA. Hmm.
Thanks for the newly self emp no.
From the few things you've told me thus far, it's clear there is A LOT I don't know - thank you for alerting me to this (feels like one of those nightmare dreams where you turn up to the exam having done no work, or is that just me?)
Anyhow, I am also working on convincing my DH that we ought to have the same accountant and that I ought to look at being employed by his company (I need to look into this further - in order to convince him of the value, currently rcvg looks.)
So thanks again for your help - hugely appreciated!!

Hi the child benefit claim allows your ni contributions to be waived for your state pension as long as you have a child under 12 (current rules). HTH