Paying self assessment through PAYE

jilt

Have I got this right or is my brain well and truly scrambled this month?

If so-one owes £1200 self assessment tax and NI and opts to pay it through PAYE will their tax allowance be decreased by £6000?

Monsoon

Errr.... yes. I think so.

They have to have submitted tax return by 30th December for a coding to go through - it's too late now for 2009-10 tax returns.

If you're asking because you want to know about prior codings, I always phone HMRC and ask what previous tax has been put through this year's code so I can put the right number on the tax return.

Tax codes bake my noodle!

jilt

Thanks Jenni.

Oh damn forgot about the December cut off! Oh well good job I hadn't mentioned it to the client yet, phew!

Monsoon

No worries.

AK002

I think the liability has to be below £1000, as that's when POA's kick in?! (Someone else will no doubt confirm...)

Monsoon

No I'm pretty sure its £2k.
If you get it coded, you don't have to pay poas, how nifty is that?
If you ask to get it coded, then chabge your mind, pay the liability in jan and get your code back to normal before april, you get away with not paying PoAs, how nifty is that? Not sure its reliable but happened to my vclient by accident 2 years ago (genuine change of plan).

AK002

That's quite nifty

jilt

Yeah can pay through PAYE if not more than £2000, and P on A not required if tax liabilty below £2000 now. Shame they didn't come to me last month.

jewels.p

Did it used to be £1000 before POA's start? Cause that's what I thought it was

jilt

jewels.p wrote: »

Did it used to be £1000 before POA's start? Cause that's what I thought it was

It did Jewels yes

Monsoon

jilt wrote: »

It did Jewels yes

And £500 a few years before that.

Didn't know it had gone up to £2k!

jewels.p

I didn't know that either when did that happen?

deanshepherd

It didn't.

£1,000 is the payment on account threshold. (Unless you meet the 80% rule).

Monsoon

deanshepherd wrote: »

It didn't.

£1,000 is the payment on account threshold. (Unless you meet the 80% rule).

That might be why I missed it then....!!

jilt

This is very strange, why is it on a couple of returns with ftax it's not asking for a payment on account when the tax liability is between £1000 and £2000?! And on others it is, its a good job I haven't given the figure to pay to the client yet.

Have you had that Jenni? Or have you stopped using ftax?

OMG I apologise profusely, what a donkey! Sorry Jewels as Dean so rightly says it is still £1000 before POA kick in.

Yes Dean I understand what you mean now, both the clients are also employed who weren't being asked for payments on account. I foolishly thought it had increased to £2000, although where I got that figure from god only knows, I'd just read that the POA rules had changed. How embarrasing

Monsoon

Don't worry about it Jill, it happens to all of us in some way or another!! I told someone to raise an invoice in Jan at 17.5% not 20% because it was for December work (and then corrected myself) - d'oh!

I've not had that issue with Ftax (and yes I'm still using it) - have you downloaded the latest version from the website?

Remember if their income is from multiple sources and some is taxed at source PoAs may not kick in.

jilt

Monsoon wrote: »

I've not had that issue with Ftax (and yes I'm still using it) - have you downloaded the latest version from the website?

Remember if their income is from multiple sources and some is taxed at source PoAs may not kick in.

Yeah I realised all this afterwards, there's nothing wrong with ftax, it's me lol

Note to self.... order a new brain for you birthday!