I want to start my own business, but I’m not quite ready to leave my job yet. Is it possible to be an employee and self-employed at the same time?
Yes, you can. For tax purposes, you’ll continue to have one personal allowance which you claim against your employed tax code. Your employed and self-employed income is then combined into one. A few things you’ll need to do to stay on the right side of HMRC:
- Register as being self-employed within 3 months of starting your business – if you don’t, you could face a £100 penalty
- Complete a Tax Return every year.
- Pay Class 2 and Class 4 National Insurance contributions on your self-employed income, as well as the Class 1 contributions that you’re used to on your employment income. However, dependent on your level of income, there is a maximum amount of national insurance you have to pay and a refund is available should you overpay during the year.
Give us a call for more information on how it all works!