Yes, but you can only pay Class 2/Class 4 contributions if you ARE self-employed, otherwise you will need to pay Class 3.
David
Yes, but you can only pay Class 2/Class 4 contributions if you ARE self-employed, otherwise you will need to pay Class 3.
David
"David Floyd" wrote
But that's easy, though, isn't it? Simply start a very small "hobby" business ...
Alternatively, if you have a spouse get them to employ you to do things you genuinely do, eg work around the house/garden etc. They should pay you somewhere between the NI LEL and PT (about 82-94 a week).
Then you'll get NI credits for free (no employee or employer NI), and it'll count towards more than just the state pension (you'd get SSP, SMP, even JSA if your spouse sacks you!).
"Andy Pandy" wrote
Yes - but then, running the payroll proerly could be a bit of an overhead...
Presumably if you took your sabbatical year starting on 6th of October you would get quite a big income tax rebate, and you would pay less income tax from the time you started working again a year later 'till the next 6th of April . Whereas if you started your sabbatical on 6th of April then you'd get no tax rebate and pay tax at full whack as soon as you started working again.
(I think)
DG
Indeed, in one case you pay tax on virtually no income for a whole year, while in the other you pay tax on roughly half your normal income for two years. Shouldn't be a vast difference, but significant nonetheless, given the progressive nature of the tax system, i.e. tax on half your income is less than half the tax on the whole income.
I just told the IR I was self-employed and that was it - seemed cheaper than paying class 3.
They'll be sending you a tax return and expect you fill in the self-employment pages. That'll be fun, then, won't it, if you need to concoct fictional accounts.
Then when you complete your SA pages with 'nil' in all the boxes the contributions agency arm of the Inland Revenue (HM Customs & Revenue) will inform you that you have insufficient contributions.
It hasn't proved a problem for the last 4 years - they never send the self employed pages and never seem to have a problem with the accounts I return. They can always come back to me if they are not happy. I read that they send out 30 million letters to the wrong address each year.
Maybe you have misunderstood how this works?
There ought to be a considerable difference, because one year's income is spread over two tax years, with two personal allowances and two reduced rate bands to take into consideration.
Isn't that what I said? Isn't "considerable" nearer "significant" than "vast"? :-) Don'tcha just love these wishy-washy terms?
Exactly. Were the sabbattical to coincide with a tax year, the second PA and RRBs would be wasted as there'd be no income (to speak of) to set them against.
Customs and IR have merged. It won't be long before NICO merges too, and they'll share all their information. Then you'll be stuffed.
Bit behind the times there Ronald, they merged years ago, it was the first of the spate of government mergers.
DF
Oops. Right you are. So he's stuffed already. Well, almost. Give them a few more years to get their actual act together, as opposed to being just cosmetically under one roof.
Contacted them today explaing the situation - they don't seem to concerned about it though so am sending them a letter.
They may not be concerned now, but the crunch might come when you try to claim your BSP, at which point they'll do a spot of checking and find that you only paid C2 when you should have paid C3, and they'll simply say "those years haven't been paid for properly so they won't count at all", and reduce your pension accordingly.
Good strategy, innit? Not being concerned now will save them a fortune later.
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