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National insurance contributions

Discussion in 'Private tutors' started by Boardingmaster, Feb 9, 2020.

  1. Boardingmaster

    Boardingmaster New commenter

    Hi,

    wondering if any of you could help me. I am doing some private tutoring on top of my job as a teacher. Under PAYE, I earn enough that my national insurance contributions are in the 2% bracket. On my self employed tutoring income, will my class 4 NICs be 9% over the allowance or will the fact I pay so much on PAYE be taken into account. I’ve only ever earned under the allowance as self employed before, so could do with some help, thanks.
     
  2. Informant

    Informant New commenter

    The first question is how much is your (self employed) tutor income. If it's less than £1000 you probably don't need to register for self assessment and the tax man will disregard it. If it's more than £1000 you may wish to tick the box to claim the "Trading allowance" which means you'd like a £1000 allowance for your expenses, without actually keeping a collection of receipts to worry about the precise amount. If your expenses are over £1000, a collection of receipts would be better and leave that box unticked.

    The trading allowance was introduced in 2017if I remember correctly. I think you'll find unless you earn a substantial amount through tutoring then NI contributions for that income is voluntary.
     
    Boardingmaster likes this.
  3. Boardingmaster

    Boardingmaster New commenter

    I’m currently looking at around £800 a week on average, maybe a bit more in the holidays. I realise the financial year ends at a pretty convenient time, but it may be that i go over the 8600 threshold for class 4, at which point I am not sure what happens

    thanks
     
  4. BG54

    BG54 Occasional commenter

    It used to be possible to apply for Class 4 NI to be deferred if you were also paying Class 1 & 2 NI but this was stopped so I would imagine you'll be charged Class 4 NI on the amount of your self-employed profit above the £8,632 threshold.

    If you use the £1,000 trading allowance then you have a de facto self-employed income limit of £9,632 before you're liable for Class 4 NI payments.
     
    alsoamum likes this.
  5. catbefriender

    catbefriender Lead commenter

    suzette likes this.
  6. suzette

    suzette Occasional commenter

    I agree. With regards to HMRC, even if you think you don't have to declare because of not earning much, you can't take chances. It's best to ask them just in case.
     
    catbefriender likes this.
  7. Abitofeverything

    Abitofeverything Occasional commenter

    Can I just add that as a parent, if you're claiming child benefit, you get NI contributions to your state pension until your youngest child turns 12. Handy to know and a good reason to claim CB even if your partner goes over the threshold and you need to pay it back.
     
  8. Boardingmaster

    Boardingmaster New commenter

    Thanks for all the advice, I will call up HMRC. We don't claim child benefit itself due to my salary, but we ticked the box on the form to maintain NI contributions. The trading allowance is amazing I have to say, given I have pretty much no expense beyond I guess a little electricity, to get an extra £400 is pretty decent!
     

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