Self employed with PAYE

I'm quite sure you would not be considered self-employed, at least not until you started making serious profit. You would be engaging in a hobby and anything you earned would be "miscellaneous other earnings".

Only once it became a serious revenue-earner could you be considered as actually trading.

Yes it would be in addition. Employed NI is class 1. Self-employed is class 2 plus class 4.

Yes. Assuming your full time job earns you much more than the "tax free" amount and the 10% band, any SE income would be taxed at 22% (assuming your total income doesn't put you into the higher rate bracket). You don't actually pay the 8% class 4 though, unless the income from this SE business itself exceeds £4XXX. You can also get let off paying class

2 if your SE income is less than the exception limit (which is a bit lower than the £4XXXX limit).

Yes.

Not normally. You carry the loss forward to set against future SE profits.

JOOI, what kind of level of such income would be the usual cut-off point at wich you would be considered self-employed?

Again, what counts as "serious", in this context?

Mark

Looking at this it seems to imply that there isn't any amount you need to earn before you're considered to be trading.

It's not as simple as saying there is a cut-off, it boils down to whether it contributes a significant proportion of your income, or consumed a significant proportion of your time. I'd expect to see you spend at least a tenth of your time on it or earn a tenth of your income from it, before bothering with considering yourself to be a proper self-employed trader. If annual profits were less than maybe £1000 I would just put them under "miscellaneous".

'considered to be trading' as in 'need to pay income tax on profits made' (although if you are just selling your own stuff, then it is not an issue). There is a space on a tax return for 'any other income' .. use it.

IIRC, the question of NI should not arise unless/until you make huge amounts of money, assuming you're already paying Class 1 NI through being employed. The IR is probably a lot more interested in 'unemployed' people who are, in fact, 'trading'.

There is a box to tick on the SA form if you want losses to be set against "other income". 3.85 on page SE3.

"Ronald Raygun" wrote

What if you had, let's say twelve different businesses, each roughly the same size and generating roughly the same income and taking up roughly the same amount of your time?

Then each of them would be below your "tenth" ... ;-)

Yes, but since you "are" all of them, you have twelve of these "tenths".

It's not a question of whether any particular business makes you SE, but whether *you are* SE by virtue of the sheer weight of your wheeling and dealing.

If the self-employed activity is a trade for tax purposes and it meets the additional test that it is conducted on a commercial basis with a view to profit,then you may in principle claim the loss against your employment earnings in the year of loss. In the opening years of a trade, the calculations can get a little complicated. I've asssumed the loss attributable to the tax year is less than your earnings for the year, just to keep life simple.