Help with Tax Return!

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lorraine
lorraine Registered Posts: 404 Dedicated contributor 🦉
in General accounting discussion
I have a family member who is sub contracted by a company and they pay him. Where do I put what he's earned because he says that he has put it in turnover because he has no idea where else to stick it, then he has a problem with NIC's, because as self employed he pays Class 2 NIC but Class 4 keeps coming up!

I just wanted to give him some pointers really on what to do.

Many thanks Lorraine

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  • Strantona
    Strantona Registered Posts: 14 New contributor 🐸
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    Tax Return

    This is correct you need to enter it in the turnover, further on tax Return it will have a box where you enter the cis tax paid, he is liable for class 4 ni on profits as he is self employed
  • groundy
    groundy Registered Posts: 495 Dedicated contributor 🦉
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    Class 2 NIC is paid by all self employed whereas Class 4 is based on profits. I would advise they seek help from an accountant.
  • lorraine
    lorraine Registered Posts: 404 Dedicated contributor 🦉
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    Thank you Strantona and Groundy for your answers, I have passed them on.
  • [Deleted User]
    [Deleted User] Posts: 0
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    Has the family member registered with HMRC as a sub contractor? If so, the company will pay him a gross amount in which he will have to deduct income tax and NI 2 & 4.

    If they haven't registered, the company will automatically deduct NI and income tax.

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