Class 2 NI

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T.C.
T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
in General accounting discussion
If a client is self-employed and paying Class 2 contributions, then gets a part-time job too, does he still have to pay the self-employed Class 2 NI? Can't get my head around this. :lol:

Client is self-employed in own business, is a self-employed partner in another and now has two part-time jobs (employed).

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  • Dean
    Dean Registered Posts: 646 Epic contributor 🐘
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    T.C. wrote: »
    If a client is self-employed and paying Class 2 contributions, then gets a part-time job too, does he still have to pay the self-employed Class 2 NI? Can't get my head around this. :lol:

    Client is self-employed in own business, is a self-employed partner in another and now has two part-time jobs (employed).

    Yes is the simple answer.

    There is an annual maxima calculation for NIC in each tax year. This compares the sources of income and works out the NIC due - if the client has paid too much they get a rebate!

    Its a total pig of a calculation and one that an extremely mean examiner put in my ATT exams! Legislation was a god send that day! There's about 9 steps to it - I still can't remember it but I will try and dig out a link for you.

    Regards

    Dean
  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    Oh thank you Dean. That would be a great help.
  • Dean
    Dean Registered Posts: 646 Epic contributor 🐘
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    This is the one in your scenario I think: Click me!

    At the foot of THIS page there are links to the calculations to other scenarios.

    Enjoy!

    Regards

    Dean
  • Dean
    Dean Registered Posts: 646 Epic contributor 🐘
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    Okay I'm looking that the calculation and it's using 8% for the self-employed part. This is obviously wrong and you will need to put in the correct %age's. Unless it's now been binned because it was so cumbersome!

    Regards

    Dean
  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    Now I am confused. So as a self-employed person the Class 2 is payable and at the end of the year the calculation can be done for maximum Class 4. How does the automatic tax calculator come in to this, or do you have to apply separately for the refund??? :lol:
  • Dean
    Dean Registered Posts: 646 Epic contributor 🐘
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    You have to apply by writing to HMRC.

    I'll leave you to bang your head against the wall with the calc though. :001_tongue: To make the claim you really will have to understand it. If I can be slightly help with it though; it mainly takes effect if your client is a HR earner.

    Regards

    Dean
  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    Thanks again. I will practice the calculation. I must get my head around it. I will be back with any major queries. :thumbup1:

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