I am trying to get an estimate of what my possible self-assesment tax liability will be, but I also have a PAYE job, on the tax summary page it will either show me £0 if I don’t include my PAYE income, or £1,134.72 if I do (see screenshots bellow), celarly I’m not going to have to pay ~£1,300 on proffits of only ~£1,800, I would personally expect this to be no more than about ~£370 based on a 20% tax rate.
From my payslip from ASDA, I’ve already paid £1,523.00 on that ~£16,400, this seems ridiculously high on it’s own, I would have estimated around £750 based on my 1263L tax code, not to mention this is this is more than it’s expecting me to pay when both incomes are included.
Essentially, is there a way I can tell the software how much I’ve earned from PAYE income, and how much Income Tax I have already paid?
Hi Darren, It helped a little bit, what I’ve worked out from using that is, if I put the £12,570 allowance into the ‘Other Income’ box, it assumes I pay TAX on all other earnings, and shows me about £350 which is what I was expecting, but it gives me a rough idea as to what I need to put aside. Thanks, Daniel
You can do your own quick calculation for income tax with the following table.
It’s a basic table that will give you an idea of what income tax will be payable with your combined employment and self employed income.
Firstly, from your post you were mixingup turnover with profit. Lets assume you use up all of your tax free allowance on your PAYE job. All of the profit is then taxed at 20%. That’s it.
For a small turnover it counts as additional income, not self employed income. No NI is charged on side hustles unless it is big enough to be a genuine business. Yuo need to speak to an accountant about when NI is due as the rules are much more complicated.
I have used Tax Calc for years for doing a self assessment return. However, most small businesses lose money once the various costs are included, so make sure you have included ALL your costs before worrying about other stuff. Usually a business doesn’t become profitable for several years.
I would say if your wages are £16400 and your tax code is 1263L then your free pay is £12630
16400-12630 = 3770 @ 20% = £754.00 if you have paid £1523.00 (possible overpayment of £769.00) you need to check your payslips to see if at anytime this tax year you had a different tax code or is your tax code 1263L W1 which would be an emergency code.
You also have to take into consideration if you owe tax from previous years?
If you don’t owe tax then its highly likely they will owe you a refund.because if you have overpaid the £769 then on roughly £1900 you would only owe them £380 which would mea they still owe you a refund.
But check your tax notifications to see if you owe anything and also check your tax code as if they are using 1263L then there is a problem with the amount you have paid this year to date.
Hi AddingUp, at the moment I’m more just looking for a rough estimate, so I ensure I have enough cash free to pay the bill, there’s not much in expenses for what I do, but those have actually been taken into account in what I was calculating, as turnover at this time was ~£2,400. Daniel
I don’t owe any tax from the previous year, as I was PAYE only then that was easy enough to check, I earned ~£27,682 and paid ~£3,008 and that’s what I would expect.
I definatly think I’m owed an over payment, and I think it’s because of an overpayment of wages from over a year ago, when I finished paying it back, payroll did something where they paid it all in one column, but then took it back in another, I’d already paid tax on this in the previous year, so I don’t know why they did this, and speaking to payroll is just impossible.
I would expect a the 1263 to be accurate as I get a ‘uniform allowance’ but the L code seem’s strange to me, I was A for decades, until a couple years ago.
If your tax code has an ‘A’, this is most likely referring to Statement A on an HMRC starter checklist, which you would tick if:
This is your first job since the last 6 April.
You have not been receiving taxable benefits such as Jobseeker’s Allowance, Employment and Support Allowance, taxable Incapacity Benefit, State Pension, or an occupational pension.
The above statement is off the internet.
You could be paying emergency tax because you are also self employed, do you have any other income or pensions as this could also be a reason for a higher code. But an A prefix is unusual.
Ahh, I thought it was the other way around and the A prefix was the norm, I only have my PAYE income from ASDA, and my Self Employed Income that’s only been from around June this tax year.
L is the normal code - if you sign onto HMRC website using your government gateway id you should be able to view everything from your current job and previous payments and they will also tell you, your current code and if there was anything owing to you.
If your not signed up for it, i suggest you do its a really good site and gives so much info
