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Original poster

Maternity allowance - am I stuffed?

53 replies

breadhead · 18/08/2017 09:30

I am 23 weeks pregnant today and only just realised I may possibly be eligible for some maternity pay, but my work is pretty casual so don't know where I stand or what to do from here.

For the past 3 years or more I have earned around £300 a month from cleaning 3 friends' houses. This is a combination of cash in hand and bank payments. I also work as a freelance writer which I get paid around £250 a month for directly into my bank account but without any tax deducted. I also do exam invigilating for a local school which I am paid for on their official payroll but do not appear to be paying any NI contributions. Plus I do a few small, random online jobs e.g. surveys, which I get paid for on their payroll but again they have not deducted NI. I have also recently done a random novel editing job for a friend for which I was paid £500 into my bank account. Was I meant to declare this somehow? (not even sure how to 'declare' anything!)

Because I earn less than £10,000 a year I assumed I didn't need to declare anything as I wouldn't be taxed on it. Was this wrong, or even tax evasion?! eeek!

I am neither registered as self-employed, not have a small earnings exemption certificate. Embarrassingly, I know little about tax - thought I was simply topping up our family income legally.

Anyway, I am due in 17 weeks time. Do I have time to sort any of this out and be eligible for maternity allowance? Any advice very welcome!!

OP posts:
PlaymobilPirate · 18/08/2017 10:29

I agree serf - its not much... but the op still wants something having not been prepared to give anything.

SerfTerf · 18/08/2017 10:32

Well people frequently believe daft things about personal finance. She's sorting it out now.

Penfold007 · 18/08/2017 10:37

Just a thought but has your household been claiming benefits or tax credits?

Original poster
breadhead · 18/08/2017 10:39

I definitely don't earn over £10,000...without a shadow of a doubt. Any surveys etc may get me around £10 - £15 a month!! And I have only had one editing job paying £500 as I am trying to set up my own business as a freelance editor/proofreader (and doing a training course).

You don't believe "I'm not tax savvy?" Yes, I admit I'm dumb in the extreme. But I did know that the threshold was £10,000 so I didn't need to pay tax for the past few years. There would have been no sense in my avoiding paying any tax, as I knew I had none to pay!

And I only discovered recently that I might be entitled to Maternity Allowance. Surely it makes sense for me to explore the options, as I have been earning, and not taking a penny from anyone else?

OP posts:
Hotpinkangel19 · 18/08/2017 10:41

Do you claim tax credits or other benefits?

Original poster
breadhead · 18/08/2017 10:42

Playmobil Pirate - I was very prepared to give! I just didn't think I had to as I was told I was earning under the threshold so didn't have to pay tax!

OP posts:
grannytomine · 18/08/2017 10:45

If you are earning under £10k a year you won't owe tax. Each job is assessed separately for NI so you aren''t paying NI because you haven't earned enough from that job. For the self employed part you need to pay NI if your profits are more than £6k (roughly) that doesn't mean being give more than £6k but more than £6k after expenses.

Original poster
breadhead · 18/08/2017 10:55

Hotpinkangel19 and Penfold007 - no we don't claim any benefits or tax credits of any sort.

grannytomine - thanks for your explanation of NIC. I thought that's why I haven't been paying them. My earnings are rarely more than £600 a month (maybe once or twice this year) so I probably don't earn over £6,000.

So you think I would be okay to phone the tax office and get advice? Again, I don't mind if I do owe anything - I just would like to get everything above board now I know re. being self-employed and hopefully get some support when I can't work as much.

OP posts:
BoredOnMatLeave · 18/08/2017 10:57

I've had a few people who thought the same as you OP and have always said "you may not need to pay tax but how the hell are HMRC supposed to know that if you don't tell them how much you did earn".

Anyway register as self employed and start submitting self assessments. You might have to pay Class 2 NIC if you have earned over £6,025. If you pay enough Class 2 you could be eligible for maternity allowance.

Original poster
breadhead · 18/08/2017 11:03

BoredOnMatLeave - you are quite right. I feel very dumb for not realising.

Thanks for your advice - I will try to register as self-employed today and go from there.

OP posts:
Lizardtoes · 18/08/2017 11:04

Fill in the forms, you'll get an invitation to pay the ni for the test period they work it out on so you get a.higher rate. I know I need to pay about £30 ni, they'll send me a letter in two weeks. I work for a charity on a casual basis, I earn about £500/600 a month.
Don't panic! You'll at the very least get the lower rate of £27. They won't leave you with nothing.

SerfTerf · 18/08/2017 11:06

PHONE THEM! Smile

Original poster
breadhead · 18/08/2017 11:12

Lizardtoes - thank you. Not panicking, but we will struggle to drop £550 a month all of a sudden without other support. Tough lesson to learn, but hopefully I can sort in time if I start now.

OP posts:
Original poster
breadhead · 18/08/2017 11:20

ok - I might be brave and phone them :)

OP posts:
grannytomine · 18/08/2017 11:36

breadhead, I would phone. They can get a bit stuffy if they find you but if you tell them, even if a bit late, they are usually fine. I used to run a payroll and had quite a few staff come to me with similar issues and it usually worked out fine. Hope you get it sorted.

LaptopLoverrr · 18/08/2017 11:37

How have you got to your age without realising that in this country people need to pay tax and national insurance?

Hmm
Syc4moreTrees · 18/08/2017 11:50

If your jobs are all classed a separate employment (which they probably are given they are many and varied) you may be subject to tax on a second job. IF you actually sat down and worked out how much you earned including the cash in hand you would probably be surprised how much this adds up to. I would be surprised if you hadn't been supposed to be paying tax and you should have paid NI contributions.

grannytomine · 18/08/2017 11:51

LaptopLoverrr, how is that helpful? You would be amazed at how little is generally known about tax and NI. If only I had a pound for every time someone told me they didn't have to pay tax because they were a student, they knew it was true because their mum, gran or the lady down the road told them. I have spent a vast amount of time trying to explain tax and NI to people and how statutory benefits like sick pay or maternity pay work and it is often totally pointless as by the next month they don't understand it all over again.

BoredOnMatLeave · 18/08/2017 12:46

granny.. I agree. Sometimes wish they would cover some basics at school, just things like tax, NI, interest rates etc. It shocks me when I talk to my little sister (18) and friends, they don't even know what national insurance is Shock and had no idea that they would have to pay interest on a credit card.

Original poster
breadhead · 18/08/2017 12:53

LaptopLoverrr - I don't think you've read the whole thread. Of course I know people have to pay tax and National Insurance. I have worked full time for many years before and I done just that. But I also knew that you didn't have to pay any tax if you earned under the threshold.

What I didn't realise (at my age!) was that I should have registered as self-employed when I started earning bit-money when raising my children. No one told me. I don't generally read about financial matters.

I have made an error but I am not stupid.

Thanks for all the helpful replies.

OP posts:
Original poster
breadhead · 18/08/2017 12:59

I definitely don't earn much over £6,000! I wouldn't miss £4,000 going into our account .... Confused and can mostly certainly count :)

I am actually being told different things on this thread. Should I, or should I not have, been paying NI contributions for earning that amount?

OP posts:
SerfTerf · 18/08/2017 13:36

There are four different classes of NICs. Those that apply to PAYE employees (class 1)will usually be calculated on a WEEKLY arnings threshold rather than annually.

Class 2 and class 4 are for self employed people and are based on your annual figures.

Class 3 are voluntary and are paid to fill in any gaps. You have a few years' grace to do that retrospectively if you need to.

It can get wonderfully complicated if you're both PAYE and SE. (I'm in that position too.)

Honestly, call them, they are quite helpful.

Have you got the "newly self-employed" helpline number? Start with them and explain your mistake.

SerfTerf · 18/08/2017 13:42

www.gov.uk/national-insurance/national-insurance-classes

www.gov.uk/national-
insurance/how-much-you-pay

www.gov.uk/self-employed-national-insurance-rates

I doubt that you much, if anything.

SerfTerf · 18/08/2017 13:45

That you OWE much^

Viviennemary · 18/08/2017 14:32

I thought if you earned less than the personal allowance then you didn't pay tax or have to declare it but not absolutely sure. If you haven't been paying NI and you don't need to then I don't think you are eligible for any maternity pay.