tax allowances. advise please re. 2 jobs...

[tara4now]

if someone has two jobs, but the total earnings from both jobs combined is less than 5k , do you have to pay tax? i know that if someone is working one job and earning less than 5k per yr, it is tax free. i wondered if this was still the case if it was more than one job??

[KatyMac]

Exactly the same - the IR should know about both jobs & issue a tax code for each

[Iota]

tax kicks in based on total income from any ( apart from tax free like child benefit) source

So if the total income is under £5k there is no tax to pay

[somersetmum]

..and you won't pay NI on either of them until you reach the £5k limit (separate allowance for each job).

[tara4now]

how does it work if one job is as self-employed(part-time childminder), and the other is as an employee(e.g. part-time shop work/pub etc?)

[ChasingSquirrels]

exactly the same, if your total taxable income is below the personal allowance then no tax.
You may have to do a tax return because of the self employment though.

[KatyMac]

You just put all the infor on your self assessment form & HMRC work it all out for you

[tara4now]

ok. i do a tax return for childminding. was thinking of 'topping up' my income with a part-time job somewhere.

[KatyMac]

But you would have to pay NI about £2 a week a a self employed person - unless you have a small earnings certificate for low income

[tara4now]

sorry...if i had a second job, wouldnt my employer do the tax etc? and i still do my own for my childminding?

[JingleyJen]

The NI liability is dependant on how much you get paid at any one time so if you get paid £5,000 equally across the months of the year you should be ok but if it is a lump sum you cross the threashold.
The IR sort out if you have to pay tax - you still have to declare your income.

[KatyMac]

So get a job - don't sign the P46 - you will go on emergency tax code until you write to the IR to explain - then you will get a tax rebate

[tara4now]

katymac, i do pay n.i. its around £28 every three months approx. i just wanted to get a few things straight before i looked for another part-time job somewhere.

[tara4now]

right, ok. thanks for the info.

[Wisteria]

It doesn't matter how you earn your money - you are allowed to earn up to your tax code tax free, irrespective of how many jobs you have.

However, the employers may take tax and then you'd get a rebate at the end of the tax year, depending on who you're working for; agencies in particular do it like this.

At the end of the year you will fill in a SA form with the employment pages as well as self employed, add up all tax you've paid out (don't forget to include any tax you've paid on savings) and reclaim it.

It is worth ensuring you pay your NI though, monthly or quarterly as you will be entitled to benefit payments, should you ever need them