Self employed cleaner, min wage, tax help please

[BeQuietBrenda]

Can anybody help. Am I best to get an accountant to help with this? Or is there somewhere I can go to get help with this? Sorry its long, just want to make sure the correct info is provided.

I've recently returned to work after the pandemic /Lockdown.

July 2016-Dec 2019 I was part time employed at a care home, single parent working 18 hours a week £8.50 ph.

I then worked 3 months (Jan-Mar) 2020 as a self employed cleaner and submitted a Self Assessment for the tax year 2019/2020, I owed no tax and couldn't claim expenses as I hadn't paid enough tax the previous tax year.

I worked approx 18 hours a week and as a single parent I was in receipt of housing benefit and tax credits.

From April 2020 to Oct 2020 I was in receipt of JSA. I then claimed Universal Credit and was unfit for work due to health reasons Oct 2020 to Aug 2021.

I am now back at work and no longer a single parent.

I work 18 hours at £9 ph.

I use my own car but cleaning products are provided by the woman I work for (she's got the contracts, I'm self employed).

Petrol and mileage is very expensive, I'm keeping a diary of everything. I clean my own cleaning cloths each day and provide my own uniform.

I've not paid tax now for at least 3 years (I paid NI at the care home) can i claim back the mileage and any expenses incurred? gov.uk says not because I've not paid any tax.

Is there anything I can do, anywhere I've not looked for advice?

Thanks in advance.

If you are self employed you don't claim back expenses, but you can deduct your expenses from your income to get your profits that you declare to HMRC. If you aren't making enough to pay tax and aren't claiming income based benefits any more there is no real benefit to this though.

I think that maybe you are misunderstanding claiming back mileage and expenses. You don't claim them back, you use them to reduce your income so you pay less tax.

Total income less your expenses = what you pay tax on.

The only thing you can do is either increase your hours worked or your £ hourly rate, or reduce your costs by finding a job nearer home.

You're not charging enough.

I use my own car but cleaning products are provided by the woman I work for (she's got the contracts, I'm self employed).

Are you sure you’re actually self employed? If this woman decides where and when you work, and provides the main equipment for you to work, that doesn’t sound like it fits the definition of self employment.

Who decides that you are paid £9ph, you or this other woman? If you’re self-employed, you set the charges.

Otherwise it sounds very much like this woman who “has the contracts” is employing you, and therefore you should accrue holiday pay etc

The short answer is no. Like others have said you've misunderstood claiming expenses.

If petrol and mileage is expensive, you can factor this into how much you charge. That's the benefit of being self employed. If you think £9 per hour is not enough for your work, you can tell your customer that you will be increasing your rate. The customer can then choose to continue with you or go with someone else or negotiate.

A lot of cleaners work this way, although technically self employed it's basically the owner of the cleaning company fixes me up with clients.

So she'll be charging (for example) £15 an hour and I get £9 of that. There's no contract, she doesn't employ me and I can take or leave clients as I see fit. She has no say over when I take time off (for example I've told her when I'll be off at Christmas, she has to accept that).

It isn't great, I realise, but I need flexibility and also minimum stress in my life (and I love cleaning, really enjoy the work).

So I clearly have no understanding of these things.... My profit after expenses have been deducted is what I am then liable to pay tax on?

My profit after expenses have been deducted is what I am then liable to pay tax on

Essentially, yes.

This is a very simple version to explain it:
Personal Allowance for 21/22 (what earn before paying tax) is £12,570

Turnover £20,000 (total amount of money you have taken)

Less Expenses -£5,000

Gross profit £15,000

Your Gross profit is your taxable income.
But you then deduct your personal allowance:
£15,000-£12,570 = £2,430

So you would pay tax on the £2,430.

You are currently earning around £8,000 per year - this is your turnover.
So there would be no point deducting expenses from this because your turnover is below the personal allowance anyway.

Does this help? I have simplified things a little bit, but hopefully it'll help.

Are you paying voluntary National Insurance contributions? Because if you aren't, then you will not be building up anything towards your state pension.

Are you paying into a pension?

What happens if you are off sick - do you get paid?

The fact that a lot of cleaners work this way doesn't mean it's right. You should really be an employee with proper employee rights, sick pay, maternity pay, a pension scheme, the lot. A lot of firms get round all this by telling their workers they are self-employed. They really shouldn't be.

So you're a self employed cleaner who works via an agency to find your clients is that correct?

The agency is taking a huge cut for this so you should think about working directly for clients, because then you'll be able to charge £15 ph or close to it and keep all the money yourself.

Maybe offer your services on local Facebook pages or Nextdoor and ask people you've cleaned for to provide a reference? You could also ask if they want you to work directly for them and cut out the agency?

You could offer a rate of £13-14 ph so you earn more and they have an incentive. But check your contract with the agency as it might contain terms that try to prevent this.

I used to be a selfemployed cleaner.you absolutely have to increase your hourly rate.I used to charge £15/hour.if you are a good,reliable,trustworthy,friendly,efficient cleaner,any sensible person will happily pay you this rate.it is a physically very demanding job.please dont undervalue yourself(sadly many women do).also,it might be worth looking to clean more locally.

Sorry,just read you are employed by an agency.ditch the fucking agency,they earn the most of the money,you actually work for and you are left with crumbs.I stopled working for agency after 1 month.they are absolutely leeches and use (mostly) women to do cheap labour for them.