A little bit of advice

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Pigpen
Pigpen Registered Posts: 331 Dedicated contributor 🦉
in General accounting discussion
I have been asked by my boss to help his son set up as self employed

He is a kite surfing instructor and will instruct here in the UK, odd days and has some fixed contracts abroad with a UK company for 1, 2 or 3 weeks at a time - He was employed by the same company up until recently when he was doing his training - That employment was standard PAYE & NI deducted employment - The self employed stuff is unlikely to take him over the £5075 small earnings limit between now and the end of the tax year so should I reccomend him apply for exception from this or is it better for him to pay something ?

The company will pay him a daily rate which they want him to invoice them for - They are paying for his flights and meals and accomodation whilst abroad - How would this effect his income ?

Any advice would be great thanks

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  • Pigpen
    Pigpen Registered Posts: 331 Dedicated contributor 🦉
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    small earnigns exception for NI I forgot to mention
  • Julia Crouch
    Julia Crouch Registered Posts: 68 Regular contributor ⭐
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    Hi

    Even though the amount p.a. will be small this sounds more like PAYE.If it is and the company pays him incorrectly it will be the company that will have to pick up the cost of getting this wrong.

    Have a go at the employment status indicator on HMR&C website, fill in the information there and see what you get back. If it indicates self employment then I recommend that you print off the report and keep with your purchase ledger files.

    If it indicates self employment he just has to telephone HMR&C with his NI number or register online at www.hmrc.gov.uk. If he phones he can sort out the small earnings for NI with one phone call.

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