Tax

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Posts Tagged ‘tax’

Students working in term-time and holidays

January 21st, 2010 By greg Filed Under: Uncategorized

We often get asked by student Mashers about their tax status and we are not surprised in the slightest that you are confused. We are too but we do have some clarity on it so that you can plan accordingly.

In a nutshell - if you are a registered student and have completed a P38S tax form and you ONLY work in Summer, Xmas and Easter holidays then you don’t get taxed at source.

However if you do ANY work outside of holiday periods then this cancels out the tax free status and you will be taxed at source on ALL earnings throughout the year.

harsh we know…but the law.

Please also bear in mind though that you will have be able to get your tax back on all earnings under £6475.00 if we are your main employer and therefore will be eligible for a tax-rebate at the end of the year after you receive your P60 confirming the amount.

and now from the horse’s mouth…the Inland Revenue…zzzzzzzz

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“There are special rules about tax for students who only work in the Easter, summer, and Christmas holidays. These special rules do not apply if you also work at other times. If you work at other times, the special rules will not apply to any of your earnings, from holiday work or other work.

So if you are a student, and you do paid work in term time, the special rules will not apply to you. The normal rules for tax and National Insurance will apply to all your earnings, (term time and holidays) in the same way that they do for other people who are not students.

Working as an employee in term time and the holidays

Income Tax

If you had a previous job, your employer gave you a form P45 when you left. Give this to your new employer.

If you have no form P45, or you left your last job in an earlier tax year, you will need to complete a form P46 instead. Your new employer will provide this form.

Your new employer will use the form P45 or P46 to find out your tax code from the HM Revenue & Customs (HMRC). Using the tax code, your employer can work out correctly any tax you must pay.

If you have more than one job at the same time, you should contact the HMRC to get a different tax code for your second job.

You will only have to pay tax if you earn more than £6,475 in the tax year (6 April 2009 to 5 April 2010). This works out as £125 a week, or £540 a month. The tax code and the Pay As You Earn (PAYE) system spread any tax due across the year as evenly as possible. In this way, if you work throughout the year, you will pay the right amount of tax. If you give up work part way through the year, a refund may be due.

National Insurance Contributions (NICs)

You pay the same NICs whether or not you are a student. Your employer will deduct NICs from your pay if they are due.

NICs will be due for any week in which your gross pay (before deductions of tax and so on) is between £110.01 to £844 per week (£476 and £3,656 a month).

NICs are due on your pay for the week or month, so you will not get a refund if you stop working part way through the tax year.

Working as a self-employed person while you are a student

There are no special tax rules for you if you are a student and also self-employed. You will be treated in the same way as other self-employed people.

You must tell the HMRC if you start working as a self-employed person. Do this by ringing the helpline for the newly self-employed on 08459 15 45 15. You must do this within three months of starting to be self-employed to avoid paying a penalty.

Later, we will send you a tax return, on which you will declare your earnings from being self-employed.

For the full breakdown of details please click on the following link:

http://www.hmrc.gov.uk/students/work_in_term_and_hols_9_1.htm

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Self-Employed versus Employed

January 20th, 2010 By greg Filed Under: Uncategorized

We are often asked why we pay our Brand Ambassadors on a P.A.Y.E (employed) basis and we understand that it is a grey area for many as different agencies have varying approaches to the legislation.

The below guidelines are taken from the Inland Revenue website and will help you (The Mashers) to understand your employment status with us.

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In most cases your employment status will be straightforward. In general terms, you are employed if you work for someone and don’t have the risks of running the business.

You are self-employed if you are in business for yourself and are responsible for the success or failure of that business. To help you check your employment status, answer the following questions.

These also apply if you are a casual or part-time worker. If you have more than one job the same questions apply for each job.

Employed – if you answer yes to most of the questions you are likely to be employed:

• Do you have to do the work yourself?
• Can someone tell you where to work, when to work, how to work or what to do?
• Can someone move you from task to task?
• Do you have to work a set number of hours?
• Are you paid a regular wage or salary?
• Can you get overtime pay or bonus payments?
• Are you responsible for managing anyone else engaged by the person or company that you are working for?

Self-employed – if you answer yes to one or more of the questions you are likely to be self-employed.

• Can you hire someone to do the work, or take on he
lpers at your own expense?
• Can you decide where to provide the services of the job, when to work, how to work
and what to do?
• Can you make a loss as well as a profit?
• Do you agree to do a job for a fixed price regardless of how long the job may take?

If you can’t answer yes to any of the above questions, you are still likely to be self-employed if you can answer yes to most of the following questions.

• Do you risk your own money?
• Do you provide the main items of equipment (not the tools that many employees
provide for themselves) needed to do the job?
• Do you regularly work for a number of different people and require business set up
in order to do so?
• Do you have to correct unsatisfactory work in your own time and at your own expense?

For more information please go to:

http://www.hmrc.gov.uk/leaflets/es-fs1.pdf

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